High reserve price for spectrum and legal issues were among the reasons that led to telecom operators in India staying away from the second round of airwaves sale, a top official of GSM industry body COAI said on Wednesday.

“For 1800 MHz band, we have been consistently saying that the price reduction was still not bringing the reserve price to the point where it was attractive for operators to make a business case and for 900 MHz, the price was double of 800 MHz band when TRAI itself has said that 800 MHz and 900 MHz are equivalent,” said COAI director general Rajan S Mathews.

Vodafone Group CEO Vittorio Colao has also criticised the high spectrum prices that were fixed for auction.

Mathews said that legal issues surrounding spectrum were also a reason operators stayed away from this round of auction. “I don’t think anybody wanted to buy spectrum which perhaps going to end up in litigation,” Mathews said.

No GSM operator applied for the auction, which was scheduled to start from March 11. The government will start process from March 11 with auction of CDMA spectrum, which has just one applicant - Sistema Shyam.

In the second round of spectrum sale, the government has announced to auction airwaves that did not receive any bids and frequencies held by telecom licences in 900 MHz band that is coming for renewal in 2014.

(This article was published on February 27, 2013)
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