Spectrum auction: Govt sets 5G ball rolling, calls bids for auctioneer

Topics 5G | Spectrum auctions | 5G spectrum

The Union government set the ball rolling for the upcoming spectrum auctions on Monday by inviting bids for selection of agency to conduct the airwave sale in various bands, including 5G, by the end of the year.

Issuing notice for request for proposal (RFP) or tender document, the Department of Telecommunications (DoT) said the deadline for submission of bids would be September 25.

“Usually from the date of selection of the auctioneer, it takes about 60-90 days for the auctions to commence,” Rajan S Mathews, Director General, Cellular Operators Association of India, said. 

The guidelines for auction of spectrum in 700 megahertz (MHz), 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 2,500 MHz, and 3,300-3,600 MHz bands will be announced separately, the notice said, while pointing to the availability of 8,093 MHz of airwaves in multiple bands.

“Notice for RFP for selection of agency for conducting e-auction of spectrum in various bands was issued by DoT on August 26,” an official release said.

The auctioneer will design, structure, and implement the overall process of e-auction, according to the government requirement, to achieve the objectives of ensuring a transparent and fair auction and selection process, optimise revenue received, and promote growth of telecom services.

In June this year, Telecom Minister Ravi Shankar Prasad had said the government will hold spectrum auction for 5G and other bands in the current calendar year.

The notice issued by DoT on Monday said the bid evaluation will be in three parts — pre-qualification, technical, and financial. The normal tenure of the contract for the selected auctioneer would be three years, with provision of a one-year extension by mutual consent, it said.

The purpose of the pre-qualification bid is to examine whether the bids received are complete as required by the bidding documents before further detailed evaluation.

Stage II is the technical evaluation where the technical bids for this RFP will be submitted with supporting documents. In the third or the final stage of evaluation, the financial bid — wax sealed in a separate envelope and complete in all respects — will be submitted.

The bidder should not have any equity directly or indirectly in any telecom service provider in India, and vice versa, and will have to declare its Indian and foreign equity holdings.

The selected agency will be tasked with designing, structuring, and implementing the overall process of e-auction and also advise on setting the rules for the bidding process. The agency will help prepare bid documents for auction and also advise on the safeguards in the e-auction system to ensure the security of the entire process, it added.

A pre-bid conference will be held on September 2 with prospective bidders. Technical evaluations will be based on criteria such as total value and number of e-auctions conducted in the past seven years, total value of telecom related e-auctions in the past seven years, design of auction process, and development of bid document, among others.

The government, which did not auction any spectrum in 2017-18 and 2018-19, wants to hold the nation’s biggest auction of about 8,093 MHz of airwaves this year, at a starting price of over Rs 5.7 trillion.

Battling financial difficulties, old telecom operators have, however, dubbed the rates as exorbitant and urged the government to review the price of radiowaves to set the stage for an aggressive 5G play.

The last spectrum auction in October 2016 saw only 40 per cent of the spectrum offered being sold. In that auction, the government had mopped up Rs 65,789 crore from sale of just 965 MHz.

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