India 3G Auction: Day 28

7:55 AM Will the bidding ever end?

May 13, 2010

1 Min Read
India 3G Auction: Day 28

7:55 AM -- The government has clearly underestimated the deep pockets of India's telecom operators. The ongoing bidding in the 3G spectrum auction has pushed the price of a pan-India license to 140.26 billion Indian rupees (US$3.11 billion), more than four times the base price of INR35 billion ($776 million).

The government had earlier expected to bank INR550 billion ($12.21 billion) from its two spectrum auctions, 3G and the upcoming BWA (broadband wireless access). Now, though, the final figure is likely to be around INR600 billion ($13.32 billion). (See Bids Flood In for India's Spectrum Auctions.)

Mumbai and New Delhi remain the most sought-after circles, with the former currently attracting the highest bid for a single circle at INR26.62 billion ($590 million). New Delhi is a close second at INR26.12 billion ($579 million).

The successful bidders are due to be handed their spectrum in September once it is vacated by the country's defense forces.

With the number of mobile users still growing a frantic pace, the operators are in great need of additional spectrum -- hence the outrage at the new recommendations for the allocation of 2G spectrum -- but even with large customer bases and a growing appetite for data services it looks as if it will take a long time for the winners to recover the high price of the 3G spectrum. (See Bharti Airtel Slams Indian Regulator.)

More details about the auction bids are available at the 3G auction archive.

— Gagandeep Kaur, India Editor, Light Reading

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