The government has kick-started the mock auction prior to the spectrum auction scheduled to begin from October 1. According to top sources in the ministry, the mock auction is held among the seven qualified bidders to ensure that the spectrum auction is conducted without any glitches. The company, mjunction services limited, is advising the government on this auction and also conducting the mock auctions. The companies that have qualified are Bharti Airtel, Vodafone India, Reliance Jio Infocomm, Reliance Communications, Idea Cellular, Aircel and Tata Teleservices. Also Read - Best Vodafone-idea (Vi) prepaid plans under Rs 100: List of plans, unlimited data, voice calls, moreAlso Read - Airtel Rs 79 plan vs JioPhone Rs 75 prepaid plan compared: Which offers better value?
The mock auction is on since morning. Mock auction will take place today (Monday) and tomorrow (Tuesday), official source in the Department of Telecommunications said. The total amount of spectrum to be offered for sale is 2,354.55MHz. Overall, based on the reserve price, the mop up is expected to be Rs 5.66 lakh crore. The 2,300-plus MHz of airwaves on the block for telecom operators is in seven bands – 700MHz, 800MHz, 900MHz, 1,800MHz, 2,100MHz, 2,300MHz and 2,500MHz, as against 470.75MHz in the previous round, which is set to fetch the exchequer $17 billion during its tenure. The government has decided to allot the right to the spectrum won through auction for 20 years. The operators will have the choice of both upfront and installments payment options.
The service providers who win airwaves below 1GHz bandwidth will have to pay 25 percent upfront, and for those winning above that, the upfront payment will be 50 percent. One new bidding-friendly measure the government has adopted this year is that spectrum won will be assigned within 30 days from date of upfront payment. Interest on deferred payment, linked to base rate, will be 9.3 percent this year against 10 percent in 2015.
For the successful bidder, the lock-in period of equity in the company has been reduced to one year instead of the earlier stipulation of a minimum period of three years or completion of roll out obligation, whichever is later. In a meeting of the cabinet in June, chaired by Prime Minister Narendra Modi, an official nod was given for the reserve price and the auction norms. ALSO READ: Vodafone India receives equity of Rs 47,700 crore ahead of spectrum auction