Auction of Spectrum approved by Cabinet
The Union Cabinet has approved the guidelines for the spectrum auction. This auction will begin in the January 2021.
- Approval has been given for the auction of spectrum in 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands.
- These spectra would be valid for 20 years.
- 25 MHz will be offered with total outlay of Rs. 3,92,332.70 crores.
- The last auction was done 4 years back in the year 2016.
- For the latest auction, the conditions have been same as that of 2016.
What will change with new spectrum allocation?
- Telecoms providers will be mandated to use new devices which are designated as trusted products.
- A national security panel will also be constituted.
- Once the telecom providers win the right to use spectrum through the auction, they would be able to augment their network capacity.
- With the new spectrum, new telecom players would be able to start their services.
How auction will be done?
During the auction, the bidders will need to comply with the parameters or conditions. For instance, ‘Block size’ under which bidders can submit their bids and the Spectrum cap which is maximum amount of spectrum which can be held by each bidder after the auction is completed. Successful bidders will be given to pay entire amount at once or they can pay in parts. Apart from the bid amount, successful bidders will also require to pay 3% of the Adjusted Gross Revenue (AGR).
It is a process of spectrum assignment. This process assign spectrum to the successful bidders in a transparent manner. With this, the sufficient spectrum is allocated to the service providers. This in turn, increases the quality of telecom services for the consumers.