In a virtual repeat of last November's spectrum auction, the second round of airwaves set to be put under the hammer has also failed to enthuse telecom service providers. Monday was the last day for registering to take part in the spectrum auction, which will take place next month. While nobody applied for GSM waves, Russian conglomerate Sistema Shyam was the sole applicant for the 800 Mhz band spectrum used by CDMA operators.
Telecom operators said despite the government reducing the base price for spectrum, the cost remained high and made little business sense. "The high reserve price is clearly out of sync with the market reality. Plus, there is the overhang on 900 Mhz spectrum where there is a legal question over refarming," said Rajan S Mathews, director general of Cellular Operators Association of India, the industry lobby group representing the GSM operators.
On March 11, the government will begin with auction of spectrum in 1,800 Mhz band for three circles that did not find any takers in the first round, which will be followed by sale of airwaves in 800 Mhz band where Sistema Shyam is the sole bidder. Already, the company has announced its intent to walk out of 10 circles. At the end, the auction for 900 Mhz spectrum will take place where the reserve price has been fixed at twice the level for 1,800 Mhz.