India’s telecom Ministry has cleared the applications submitted by eight major players for bidding across circles in India. However, the Ministry has specifically prohibited Vodafone, Tata Teleservices and Reliance Communications from bidding for pan-India spectrum.
Vodafone, one of the largest players in India’s telecom space has been banned from bidding for seven circles while Reliance Communications (Owned by ADAG) has been barred from eight. Tata Teleservices have been told they cannot bid for spectrum in the Nation’s Capital – Delhi.
At the same time, the Ministry has permitted Airtel, Reliance Jio, Idea Cellular, Aircel and Telewings to bid for spectrum in any circle across the country. RCom has been disallowed to bid for spectrum in the eight circles where it operates GSM services through a subsidiary Reliance Telecom. These circles are Assam, Bihar, Himachal Pradesh, Kolkata, Madhya Pradesh, North East, Orissa and West Bengal. Of these, Airtel and MukeshAmbani’s Reliance Jio hold 4G licenses too.
The Department of Telecommunications (DoT)has raised cross-holding norms that bar single entities from two different owning operations in the same circle. This is the reason why Vodafone has not been allowed to bid in Assam, North East, Bihar, Himachal Pradesh, J&K, Madhya Pradesh and Orissa as it operates throughout India through multiple entities. On the other hand, sources close to Vodafone and RCom maintain that they never intended to bid for these circles.The reason for Tata’s disbarment from Delhi arose on account of the company having negative net worth.
BhartiAirtel on the other hand seems to be focusing its arsenal on a different issue. The company has approached the Department of Telecommunicationsto reduce the earnest money it paid from Rupees 3,700 crore to Rupees 2, 975 crore. Despite this the battle for spectrum is expected to be intense this time.
While there have been certain casualties with the DoT coming down hard on a few players, there is a sense of renewed enthusiasm among the existing operators. This has been driven by two factors – reserve price has been reduced from earlier rounds and, a number of licenses are set to expire this year.
The Government has decided that the tenure of the earlier issued 20-year licenses will expire this year. As a result, operators like Airtel, Vodafone and Idea Cellular have no choice but to bid for spectrum, especially in the 900 MHz band. The auction starts on February 3.