India auctioned airwaves in November after a court order to revoke permits of several cellular carriers and redistribute airwaves through an open bidding. But the auction did not see any takers for CDMA airwaves, while only part of the airwaves for the more popular GSM services were sold.
The government had earlier set the reserve price of CDMA airwaves at 1.3 times GSM airwaves, a price that was criticised by operators as too high. The price was set at 36.4 billion rupees ($660 million) per megahertz of spectrum for all of India's 22 telecommunication zones.
The CDMA airwave auction is crucial for the Indian mobile phone unit of Russia's Sistema, which has been ordered to shut operations in all but one of India's 22 zones by Jan. 18 as it did not win back airwaves in the last auction.
Spectrum auction from Mar 11; EGom favours price cut for CDMA
New Delhi, Jan 7 (PTI) The second round of telecom spectrum auction is likely to be held on March 11 after the Cabinet decides on the reserve price, which may be reduced by up to 50 per cent, for CDMA-band radiowaves.
An Empowered Group of Ministers (EGoM) headed by Finance Minister P Chidambaram today finalised the schedule for auction of unsold GSM spectrum of the first round and 900 MHz spectrum together with 800 MHz band airwaves used for offering CDMA-based mobile services.
"All the auction for which announcement has been made today will be held in March 2013," Telecom Minister Kapil Sibal told reporters after the EGoM meeting.
Sources said meanwhile that the government has plans to start the auction from March 11. The auction will start with the unsold spectrum in 1800 Mhz band at a reserve price, 30 per cent lower, compared the one in the previous round held in November.
"The auction for 1800 MHz band in four circles in which bids were not received in November 2012 will be put up for auction. The reserve price will be 30 per cent lower than the reserve price that was fixed in November 2012 auction," Sibal said. The EGoM, however, left it to the Cabinet to decide on cutting base price of CDMAspectrum by 30-50 per cent. The previous reserve price – 11 times high than the amount operators paid in 2008 – did not receive any bids.
Sibal said the EGoM has decided to "conduct auction in the 800 MHz band in all circles since no bidder participated in that band in the November auction... We will take the recommendations to the Cabinet and it will decide on the reserve price."