New Delhi: The mega spectrum sale is nearing its end but the government is nowhere near its target of earning an estimated Rs 5.6 lakh crore.
On day four of the ongoing auctions, telecom companies bid to the tune of Rs 63,500 crore. The auction for Wednesday ended at the 23rd round and there are still no takers for the premium 700 megahertz band.
For the first time ever, the government has offered this premium band that is known for providing high speed internet and data services, at Rs 10,000 crore for a megahertz. The reserve price for this band was way too high for telecom companies to bid for the band.
The Cellular Operators Association of India (COAI) had predicted that the band will go unsold at such high levels. But the government had stuck to its reserve price as it was recommended by telecom regulator, TRAI or Telecom Regulatory Authority of India.
"I think setting aggressive targets per se is not a problem but they need to be tempered with realism," said Rajan S Mathew, secretary general of COAI.
All the other bands -- 1800 MHz, 2100 MHz 2300 MHz -- have been snapped up by the operators.
If the 700 band goes unsold, the government will have to either revise its pricing strategy for the next round of auditions or wait for the telecom industry to further saturate. "If we wait for another two years, maybe telecom companies would buy at a high price because by then the industry would also grow," said a government official familiar with the auction process.
On day four of the ongoing auctions, telecom companies bid to the tune of Rs 63,500 crore. The auction for Wednesday ended at the 23rd round and there are still no takers for the premium 700 megahertz band.
For the first time ever, the government has offered this premium band that is known for providing high speed internet and data services, at Rs 10,000 crore for a megahertz. The reserve price for this band was way too high for telecom companies to bid for the band.
The Cellular Operators Association of India (COAI) had predicted that the band will go unsold at such high levels. But the government had stuck to its reserve price as it was recommended by telecom regulator, TRAI or Telecom Regulatory Authority of India.
"I think setting aggressive targets per se is not a problem but they need to be tempered with realism," said Rajan S Mathew, secretary general of COAI.
All the other bands -- 1800 MHz, 2100 MHz 2300 MHz -- have been snapped up by the operators.
If the 700 band goes unsold, the government will have to either revise its pricing strategy for the next round of auditions or wait for the telecom industry to further saturate. "If we wait for another two years, maybe telecom companies would buy at a high price because by then the industry would also grow," said a government official familiar with the auction process.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
