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DoT selects mjunction Services Limited to conduct spectrum auction

The department of telecommunications has selected Kolkata-based mjunction Services Limited as the agency to conduct auction of spectrum in various bands. Earlier in October,  The DoT had issued a Request for Proposal for the selection of an agency to conduct e-auctions for spectrum in 22 telecom service areas (TSAs).The DoT is scheduled to hold auctions for spectrum in the 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz bands shortly.

mjunction Services Limited beat Karnataka State Electronics Development Corporation, Bangalore (Keonics) and C1 private limited, Noida who were found as eligible for technical bids earlier in November. (pdf)

In November, the Telecom Regulatory Authority of India (TRAI) has recommended  an increase in the reserve price for CDMA spectrum to Rs 3,104 crore per MHz, up 15.6% from Rs 2,685 crore per MHz reserve price recommended in February this year. TRAI  has also released a consultation paper, seeking comments on the valuation & reserve price of spectrum for the 2100 megahertz (MHz) band.

Earlier in 2012, Times Internet was selected as the agency to conduct auctions for spectrum in the 1800 MHz and 800 MHz bands.

What the auction agency stands to gain

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According to the Request for Proposal, the amount payable to the auctioneer will be arrived at after multiplying the rate per service area with total service area (counted separately for all bands) in which the auction is successful. Bidders have to quote only the per service area price for holding a successful auction.

Drop Dead Fee

The Indian Government has also declared a drop dead fee of Rs. 2.5 lakh per service area to be paid to the auctioneer (TIL) if the government doesn’t find the winning bids acceptable or backs out at any stage, or the winner fails to pay for the spectrum. If the government abandons the auction altogether, the drop dead fee is limited to Rs. 10 lakh.

 

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