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Update: The Union Cabinet has approved the revised 5% spectrum usage charges for the 2G spectrum auction scheduled today, reports PTI. Last week, the empowered group of ministers (EGoM) had reduced the spectrum usage charges to a fixed 5% of the telco’s annual gross revenues, so as to increase the participation in the 2G auction.

Cabinet also mentioned that telcos who do not bid and acquire spectrum in the auction will continue to be charge at existing rates which varies from 3% to 8%.

Earlier: The Indian Supreme Court has rejected Airtel, Vodafone and Idea Cellular’s plea to cancel or postpone the 2G spectrum auctions in 900MHz band, scheduled for today, in an urgent special hearing yesterday, reports The Economic Times.

It has also refused to extend their 20-year telecom licenses which is expiring in November 2014 and rejected the telcos’ offer to surrender 3.8 MHz of their 10 MHz spectrum while retaining the remaining 6.2MHz spectrum.

Cricket

This urgent hearing was held after the telecom tribunal TDSAT had rejected Airtel, Vodafone, Idea Cellular’s pleas seeking a 10 year extension of its licenses in the 900 MHz band in Delhi, Mumbai and Kolkata circles, as indicated by a separate ET report.

Loop Mobile’s License Extension Plea Rejected: TDSAT has also dismissed a similar license extension plea from Loop Mobile, as indicated by the report. Earlier Loop Mobile had opted out of the 2G spectrum auction, saying it had filed a license extension plea with TDSAT. The telco along with Bharti Airtel had also moved to the Delhi High Court in this regard in May 2013, since Loop believed that it was entitled for a 10 year extension in Mumbai circle as per the license agreement.

This development essentially means the 2G auctions becomes even more critical for both Airtel and Vodafone to retain their respective licenses in the 900 MHz band, although a Livemint report suggests that the Supreme Court has accepted a petition challenging this TDSAT order. Airtel currently has spectrum in the 900MHz band in Kolkata & Delhi while Vodafone has spectrum in the 900MHz band in Kolkata, Delhi and Mumbai which are up for renewal in November 2014.

Changes In 1800MHz Spectrum Put To Auction

Department of Telecommunications (DoT) has released (pdf) an amendment, reducing the amount of spectrum being put to auction in the 1800MHz band in 10 of 22 circles.

The circles which has seen a reduction in available spectrum are: Bihar, Delhi, Jammu & Kashmir, Kolkata, Mumbai, North East, Orissa, Rajasthan, Uttar Pradesh (East) and West Bengal.

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This has also led a reduction in the spectrum cap for each operator in 1800MHz band and the overall spectrum cap for each operator in these regions.

Note that spectrum cap in 1800MHz is calculated at 50% of total assigned spectrum and spectrum put for auction in the band in that area while the overall cap is calculated at 25% of total assigned spectrum and spectrum put for auction across all the bands.

1800MHz Spectrum Cap

Overall Spectrum Cap

Our 2G Auctions 2014 coverage

Vodafone Seeks 1% Uniform Spectrum Usage Charges For 3G & BWA Spectrum
– 5% Spectrum Usage Fee For New Spectrum in 2014 2G Auctions Pre-Qualified Bidders
– 2014 2G Auctions: 8 Telcos Submit Bids; Videocon, Loop & SSTL Not Participating
– DoT Modifies 2014 2G Auction Guidelines: Rollout Obligations, Performance Guarantees
– India’s 2014 2G Auction Postponed: To Begin On 3rd February 2014
– The Lowdown: DoT’s Guidelines For 2G Spectrum Auction In January 2014