2G auction basic details

• The 2G spectrum auction concluded on Thursday after 68 rounds of bidding. Apart from the telecom operators that bagged rights to spectrum, the government also emerged a big winner as the auction will bring in higher-than-expected revenues. The government will get Rs. 61,162 crore from the spectrum auction. This is much higher than the government's estimates of nearly Rs. 41,000 crore. The licence would be valid for a period of nearly 20 years. The telecom minister hoped that despite the aggressive bidding by the telecom operators, there would be no affect on call rates. 
• Vodafone and Airtel bagged the crucial 900 MHz band in important markets like Delhi, Mumbai and Kolkata. For these two operators, winning this band in these places had become crucial as the Supreme Court had refused to extend their licences. Bharti Airtel and Vodafone bought telecommunications airwaves worth nearly Rs. 18,600 crore each in an auction. Idea also managed to bag the crucial 900 MHz band in Delhi. 
• Mukesh Ambani-backed Reliance Jio bagged 1800 MHz band in 14 circles out of 22 on offer. This will help the company to not only offer data but also voice services in these regions. Reliance Jio had earlier won the rights to offer 4G broadband services across the country. In the 1800 MHz band, Airtel won in 15 circles, Vodafone in 11 and Idea in 11. 
• The bidding in the 900 MHz band in Delhi, Mumbai and Kolkata was very aggressive as Vodafone and Bharti had to protect their turf after the Supreme Court order. In Delhi, the winning bid was Rs. 741 crore vs reserve price of Rs. 360 crore; in Mumbai, the winning bid was Rs. 563 crore vs reserve price Rs. 328 crore; in Kolkata, the winning bid was Rs. 195 crore vs reserve price of Rs. 125 crore. 
• Bids for the 900 Mhz band remain typically higher than other bands as it is considered to be better quality spectrum. So it requires lower investments for telecom companies to set up infrastructure in 900 Mhz band. In comparison, the 1800 Mhz requires higher capital expenditure. Bids in the 900 megahertz band totalled about Rs. 23,600 crore though it was on offer in just 3 circles while bids in the 22 circles of 1800 megahertz band were about Rs. 37,600 crore. The telecom department had put on the block about 385 MHz of radio waves in the 1800 MHz band in 22 circles and 46 MHz in the 900 MHz band in 3 circles. 
• For Finance Minister P. Chidambaram, the higher-than-expected revenues from the spectrum auction have come at a crucial juncture when the government is struggling to contain the fiscal deficit to 4.8 per cent. The funds from the spectrum sale are crucial for the government to bridge the fiscal deficit, which in the first three quarters inched closer to the budgeted target for the whole year. 
• The winners from the spectrum auction can pay the part of the money upfront and the remaining amount in yearly instalments. At a minimum, the government would get an estimated Rs. 18,200 crore this fiscal, much higher than budget estimates of Rs. 11,300 crore