3G spectrum bid to start from January 14, 2010: DoT

After several delays, the Department of Telecommunication (DoT) has finally announced that the auction for third generation (3G) spectrum will begin on January 14, 2010.
According to the information memorandum posted on DoT’s website, the auction will be carried out in four stages: invitation, pre-qualification, auction and grant of spectrum. A pre-bid conference will be organised on November 16 and a mock auction on January 11 and 12. The timelines have been furnished in the memorandum but it states that “there is no pre-set timetable and the government reserves the right to determine the overall timetable of the auctions or to amend it from time to time.”
The government has decided to auction up to 20 MHz of paired spectrum in the 2.1GHz Band in the telecom service areas where 25 MHz or more paired spectrum is available. The Government has allocated one block of 2x5MHz of spectrum in Mumbai and Delhi for MTNL and one block of 2x5MHz of spectrum in the remaining service areas for BSNL.
The memorandum lays down the eligibility criteria for participating in the auction. It says that any entity that holds a Universal Access Service (UAS) or Cellular Mobile Telephone Service (CMTS) licence; or that has previous experience of running 3G telecom services either directly or through a majority-owned subsidiary, and plans to obtain a UAS licence as per the DoT guidelines before starting telecom operations can bid for 3G spectrum.
The document also mentions, “Interested foreign entities are allowed to participate in the auctions directly and apply for licences subsequently.” Hence, foreign applicants will need to form an Indian subsidiary to obtain a UAS licence or an Internet Service Provider category ‘A’ licence to participate in the bid.
The indicative reserve price for Delhi, Mumbai and Circle A is Rs 320 crore, for Kolkata and Circle B is Rs 120 crore and for Circle C is Rs 30 crore.
Apart from the 3G spectrum auction, DoT has fixed timelines for the 800 MHz and Broadband Wireless Access (BWA) auctions as well.