Auction of spectrum

The Union Cabinet has approved a proposal of the Department of Telecommunications to conduct spectrum auction through which spectrum will be assigned to the successful bidders for providing commercial mobile services.

Daily Current Affairs Quiz 2020

Key-Points

 The auction will be for spectrum in 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands.

Spectrum will be offered for assignment for validity period of 20 years. A total of 2251.25 MHz is being offered with total valuation of Rs. 3,92,332.70 crore (at reserve price).

By winning right to use spectrum through the auction, incumbent telecom service providers will be able to augment their network capacity whereas new players will be able to start their services.

Successful bidders may pay entire bid amount in one go (upfront) or may exercise an option to pay a certain amount upfront and remaining amount in a maximum up to 16 equated annual instalments, after a moratorium of two years.

In addition to the bid amount, successful bidders will also have to pay 3% of the Adjusted Gross Revenue (AGR) excluding wireline services as spectrum usage charges for the spectrum won through this auction.