Four rounds on, response to 2G auction remains muted

The keenly watched auction of telecom spectrum on Monday got a lukewarm response with no company bidding for pan-India radio waves as demand concentration was on select areas such as Gujarat and Uttar Pradesh (East).

Sources said at the end of the fourth round of auction, which started at 0900 hrs, there were no bidders for key telecom circles - Delhi, Mumbai, Rajasthan and Karnataka.

There was interest for spectrum for Uttar Pradesh (East) circle and Gujarat at the end of fourth round this afternoon, they added.

India is divided into 22 telecom circles. Companies can bid for circles that remain unsold in the initial rounds.

There was no application for pan-India spectrum, the base price for which was set at Rs 14,000 crore (Rs 140 billion)

that the industry said was too high.

Sources said the auction has drawn scant interest so far as the base price for 5 MHz of GSM radio waves or spectrum in all the 22 zones is more than seven times of what the companies paid in 2008.

Sunil Bharti Mittal, chairman of Bharti Airtel, the nation's largest telecom company, had last week predicted that the auction would be over on first day itself because of the high base price.

Bharti Airtel, Vodafone, Idea Cellular, Telenor and Videocon are bidding for GSM, but there are no bidders for the CDMA spectrum after Tata Teleservcies and Videocon pulled out of the race.

The auction will continue till 1930 hours.