Indian telecom regulator TRAI has released its recommendations on auction of spectrum in 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300-3400 MHz and 3400-3600 MHz bands.
TRAI has submitted its recommendations on 5G spectrum auction at a time when the entire telecom industry is undergoing the financial crisis due to hyper competition in India. Most of the telecom operators are not ready to make investment in 5G spectrum as indicated by COAI director general Rajan Mathews.
TRAI said the reserve price of 3300-3600 MHz band – considered for 5G mobile services — should be equal 30 percent of the reserve price of 1800 MHz FDD band.
TRAI said India government should auction the 3300-3600 MHz as a single band and TDD based frequency arrangement should be adopted for this band.
Auction for the spectrum in 3300-3600 MHz band should be in the block size of 20 MHz. There should be limit of 100 MHz per bidder to avoid monopolization of this band.
Since the TSPs are allowed to trade their partial or complete spectrum holding to another TSP, the limit of 100 MHz spectrum in 3300-3600 MHz band, shall apply for spectrum trading, TRAI said.
The roll-out obligations prescribed for the spectrum auctions held in 2016 for 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, and 2500 MHz may be continued in the forthcoming auction.
There should be no roll out obligations for spectrum in 3300-3600 MHz band. The lock-in period for spectrum in this band for becoming eligible for spectrum trading should be 5 years instead of 2 years to avoid any misuse of not mandating any roll-out obligations, TRAI said.
The revised provisions of spectrum cap (i.e. 35 percent overall cap and a cap of 50 percent on the combined spectrum holding in the sub-1 GHz bands) should be extended to 3300-3600 MHz band. In 3300- 3600 MHz band, there should be a spectrum holding cap of 100 MHz per licensee.
TRAI said the auction determined price of 800 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz spectrum bands auctioned in last two years should be taken as one of the possible values in the respective spectrum bands in the present spectrum valuation exercise.
The average expected valuation of spectrum band in a LSA should be the higher of the two figures – (i) average expected valuation of that band based on simple mean or (ii) the auction determined price of October 2016.
The reserve price for North East and Jammu & Kashmir LSAs in 800 MHz band, 900 MHz band, 1800 MHz band and 2100 MHz band may be fixed at a discount of 50 percent on the reserve price. The discount in North East and Jammu & Kashmir LSAs will also be given while arriving at reserve prices of other spectrum bands.
The reserve price for 800 MHz, 900 MHz, 1800 MHz and 2100 MHz bands (i) should be higher of the two figures – 80 percent of the average valuation of spectrum band in the LSA or the price realised in the October 2016 auction in LSAs where no spectrum was offered in October 2016 106 auctions, reserve price should be 80 percent of average valuation; and in LSAs where spectrum was offered in October 2016 auction but remained entirely unsold, the reserve price should be lower of the figures – 80 percent of average valuation or the reserve price as fixed in October 2016 auction.
The reserve price of 2300 MHz spectrum band should be equal to (i) October, 2016 auctioned determined price for those LSAs where auction have taken place in October, 2016; and (ii) last recommended reserve price in the LSAs where spectrum was offered but could not be sold in October, 2016 auction without indexation.
The reserve price of 2500 MHz spectrum band (i) should be equal to October, 2016 auctioned determined price for those LSAs where auction have taken place in October, 2016; and (ii) last recommended reserve price in the LSAs where spectrum was offered but could not be sold in October, 2016 auction.
The reserve price of 700 MHz band should be equal to 2 times of reserve price of 1800 MHz spectrum band.
In case of 900 MHz band, the new entrant should be allowed to bid for 5 MHz if at least one chunk of contiguous 5 MHz is available, else the minimum block size should be kept as 0.6 MHz, TRAI said.
