Indian panel recommends lower CDMA spectrum price

Indian panel recommends lower CDMA spectrum price

Indian ministers have reportedly recommended that the price of CDMA spectrum be cut by 30% to 50% in the country’s next spectrum auction.

The move follows a disappointing 2G auction in November which raised significantly less than expected, and the only two applicants to apply to bid for CDMA airwaves, Russia’s Sistema and Tata Teleservices, pulled out.

Reuters reports that the recommendation by the panel of ministers could raise the chances of Sistema continuing to operate in the market, having repeatedly expressed dissatisfaction with the manner in which it lost its licences and the November auction pricing.

India’s cabinet will have the final say on airwave prices for the next auction, which is due to begin on March 11, with blocks of GSM airwaves worth 200 billion rupees sold first, followed by bidding for CDMA spectrum.

The November, the CDMA reserve price was 36.4 billion rupees per megahertz for all 22 of India’s telecoms zones. This was 30% higher than GSM airwaves.

It came about after a decision by India’s Supreme Court in February to cancel all 2G licences awarded in a highly criticised 2008 auction.

Sistema’s refusal to participate in the November 2012 CDMA auction has led to the carrier being ordered to shut down its operations in all but one of these zones.

Companies with permits revoked have been asked to shut down operations by January 18 but the government has indicated it will ask for more time from the Supreme Court to attract more bidders in the next auction, according to Reuters.

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