Overpriced 700 MHz fails to sell at auction

India’s recent spectrum auction has closed with 40% of the spectrum offer remaining unsold, and with the government securing only a fraction of money it was hoping to secure.

The five-day-long auction raised only US$9.8 billion instead of the US$83.9 billion the government had hoped to secure.

The auction had offered a total of 2354 MHz across the 700 MHz, 800 MHz, 900 MHz, 1.8 GHz, 2.1 GHz, 2.3 GHz and 2.5 GHz bands.

Spectrum in the 700 MHz and 900 MHz bands went mostly unsold.

Analysts have blamed the government’s insistence on attaching high prices to the bands — US$1.7 billion per MHz for the 700 MHz band — for the failure to sell the spectrum.

Vodafone spent a total of US$3 billion across various bands, with other operators spending between roughly US$1.5 billion and US$2.1 billion for their allocations.

Image courtesy NASA.