An increase in mobile revenues is always a great thing for the government. And judging by the way the spectrum allocation auction played out recently, its set on an upward curve. Mobile Revenue from the metros of Mumbai, Delhi and Kolkata is on the way up as demand from telecom giants grows. Mukesh Ambani’s Reliance Jio Infocomm Limited (RJIL) along with Vodafone and Airtel bid a total of Rs 50,000 crore on Day 3 of the 2G Spectrum auction with the 900MHz ban the king of the auction. This was no more than a replay of what happened on Day 1 and Day 2 of the auction.
The numbers involved in this auction are quite staggering indeed. Telecom Secretary MF Farooqui was quoted as saying, “Bids of around Rs 50,000 crore received at the end of 21 rounds on third day of spectrum auction.” The provisional winning price per block for 900 MHz at the end of Day 3 was Rs, 574.73 Crore for Delhi, Rs 563.09 Crore for Mumbai and Rs 192.71 Crore for Kolkata. This was a huge rise from the bid placed on Day 1 & 2 of the auction. The winning bid in Delhi saw an increase from the Rs 530.73 crore bids on Day 2 and Rs 428.92 Crore on Day 1. Similarly for Mumbai, the price was up from Rs 552.05 Crore on Day 2 and Rs 473.24 Crore on Day 1. The bids for 900MHz in Kolkata saw a marginal increase from Rs 183.54 Crore on Day 2 and Rs 173.16 Crore on Day 1.
The 1800 MHz band Gujarat Circle received bids that were substantially less than the ones received for Metros. The provisional winning bid on Day 3 of the auction was Rs 38.34 Crore as against Rs 33.76 Crore on Day 2 and against Rs 29.74 Crore on Day 1.Overall, Day 3 of the auction saw spectrum bid price remaining steady for most of the telecom circles.
Day 1 of the auction on Monday saw bid of around Rs 40,000 Crore. Telecom Minister KapilSibal, said on the aftermath of the first day of auctions that the government has taken the bold step of rationalizing reserve prices at the start of the bidding process and this stand was vindicated with opening day bids totaling over Rs 40,000 Core. The Congress led UPA government set a pan-India rate of Rs 1,765 crore per MHz as the start price for spectrum in the 1800 MHz band, which is about 26 percent lower than the base rate in the March 2013 sale. For the 900 MHz band, it approved a rate that is about 53 percent lower than the March auction price.