Wednesday, May 19, 2010

3G auction ends, Govt to get Rs 67,719 cr windfal

Auction for 3G licence ended on Wednesday, with bids for pan-India licence touching Rs 16,751 crore that ensures the government a revenue of Rs 67,719 crore.

No single bidder bid for a pan-India license and Delhi emerged the most valuable circle at Rs 3,317 crore. Today was the thirty-fourth day of the bidding. The government’s revenues from the 3G spectrum are much higher than its original estimates and even surpassed its revised estimates by a hefty amount. The 3G proceeds will help the government to bridge its fiscal deficit.The government had budgeted revenues of Rs 35,000 crore from sale of air waves for 3G and Broadband Wireless Access (BWA) put together.

The Winners

Delhi: Vodafone, Bharti, Reliance Com at Rs 3317 cr
Mumbai: Reliance, Vodafone, Bharti Airtel at Rs 3247 cr
Maha: Tata Com, Idea, Vodafone at Rs 1258 cr
Gujarat: Tata Com, Vodafone, Idea at Rs 1076 cr
Andhra Pradesh: Bharti, Idea at Rs 1373 cr

Karnataka: Tata Telecommunication, Aircel, Bharti at Rs1580 cr
Tamil Nadu: Bharti, Vodafone, Aircel at Rs 1465 cr
Kolkata: Vodafone, Aircel, Reliance Communications at Rs 544 cr
Kerela: Idea cellular, Tata Telecommunications, Aircel at Rs 312.5 cr
Punjab: Idea Cellular, Reliance Communications, Tata Telecommunications, Aircel at Rs 322 cr
Haryana: Idea Cellular, Tata Telecommunications, Vodafone at Rs 222.6 cr

The auction for Broadband Wireless Access (BWA) spectrum would begin soon after the 3G auction is over. The 3G auction had commenced on 9 April, 2010 and there were nine bidders in the fray for the slots of 3G spectrum on the block. The government auctioned three slots in 17 telecom service areas and four slots in the remaining five states of Punjab, Bihar, Orissa, Jammu and Kashmir and Himachal Pradesh.

BSNL and MTNL received spectrum outside the auction process, but the price would be determined by the auction price.

The third-generation spectrum allows subscribers to download hi-speed data and stream videos on mobile telephones. The successful bidders would be allotted air waves in September after the spectrum is vacated by the defence forces.

The 3G spectrum saw aggressive bidding by the telecom players as India remains one of the fastest growing mobile-services market by subscribers. With the addition of over 20 million new users in March, the mobile subscriber base in the country has jumped to 584.32 million customers. The number of telephone subscribers in India, both wireless and wireline combined, increased to 621.28 million at the end of March-2010 from 600.98 million in February 2010, thereby registering a growth rate of 3.38 per cent. With this, the overall Tele-density in India reached 52.74.

Telecom players hope that the 3G spectrum will ease capacity constraints and also increase the revenue per user, which has been falling due to intense completion in the sector.

For broadband wireless access, there are 11 operators are in the fray. The reserve price for BWA spectrum has been fixed at Rs 1,750 crore and only two slots of 20 MHz each are on the block.

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