The sheer success of 3G spectrum auctions might once again reinforce the allegations of massive revenue losses incurred by the telecom ministry by not auctioning 2G licences in 2008. Last Saturday,the single provisional bid for pan-India 3G spectrum stood at Rs 7,900.48 crore,up 125.7% from the base price of Rs 3,500 crore. This means the government has so far garnered Rs 31,964.84 crore against the budgeted Rs 35,000 crore and the auctions show no signs of stopping for the next few days. Telecommunications minister A Raja has been on record stating last week that he expects revenues upwards of Rs 45,000 crore. Simple telecom arithmetic would tell you that the government would have mopped up much more than this,if it had actually auctioned 2G spectrum. Instead,2G spectrum was given away by doling out licences and spectrum at a paltry Rs 1,651 crore to eight operators on January 10,2008 which is now being probed by the Central Bureau of Investigation. Simple facts: the Sensex on January 10,2008 was at 21,000 points,its all-time high. Currently,it is hovering below the 18,000-mark. This clearly establishes that the ability of mobile operators to pay for precious 2G spectrum at that time was much higher than it is now. Second,3G spectrum is a different wireless band2.1 GHzrequiring different equipment and networks. In contrast,2G spectrum equipment and networks were existing with the operators in 2008 and would not have required higher capex,meaning the companies would have bid much more aggressively to get 2G spectrum were it auctioned then,than the current 3G spectrum auctions. Third,India is,and continues to be a voice market (92%) rather than a data market of 3G and broadband. Sample this: Against 563.73 million mobile phone users,we have around 60 million Internet users and less than 10 million broadband users.
