Pan-India momentum pushes 3G price up 38%

The momentum for auction of third generation spectrum continued for the fifth day with a pan-India price reaching up to Rs 4,831.09 crore (Rs 48.31 billion), up 38.03 per cent from a base of Rs 3,500 crore (Rs 35 billion).

A total of 28 rounds of bidding, which started on April 9, have been completed till Thursday and is expected to be over in another one-two weeks' time. Gujarat continues to have the highest bid price at Rs 487.76 crore (Rs 4.87 billion), followed by Delhi at Rs 464.54 crore (Rs 4.64 billion).

Both Delhi and Gujarat circles have a base price of Rs 320 crore (Rs 3.2 billion) each.

However, demand for 3G spectrum in Category C circles did not pick up even on the fifth day. Orissa, Assam and Jammu & Kashmir circles saw no bidders on the first, second and third day.

Orissa and Assam have three slots for 3G auction, while in Jammu & Kashmir there are four slots available.

Six existing major telecom service providers -- Bharti Airtel, Vodafone Essar, Reliance Communications, Idea Cellular, Tata Teleservices and Aircel -- are vying for spectrum in all 22 circles.

So far spectrum has been given bundled with unified access service licence at a price of Rs 1,650 crore (Rs 16.5 billion).

The government expects to earn Rs 35,000-45,000 crore (Rs 350-450 billion) from 3G and Broadband Wireless Access auctions.

Telecom PSUs Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd have been allotted 3G spectrum ahead of the private players.

The two have also launched their 3G mobile services. However, they would have to match the highest bid.