TRAI launches 2G spectrum auction; Uninor readies strategy

7 Feb 2012

The Telecoms Regulatory Authority of India (TRAI) has initiated plans to auction 2G spectrum, inviting comments on the proposed tender by 15 February. The sale follows in the wake of the cancellation of 122 concessions in 22 service areas earlier this month: the Supreme Court ordered that the licences be revoked on the basis that their allocation in 2008 had been ‘totally arbitrary and unconstitutional’.

According to the Economic Times, the majority shareholder in one of the affected cellcos, Uninor, Norway’s Telenor plans to participate in the auction, but has not ruled out an exit from India if the price is too high or if takes issue with rules regarding the tender. The head of Telenor’s Asian operations, Sigve Brekke commented: ‘In principle, we are okay to bid in an auction but the outcome will depend on base price and eligibility, among other issues. This is an auction of spectrum, not licence and so incumbents that have licences should not be allowed to bid.’

In addition, Telenor will be throwing its weight behind a legal and diplomatic challenge of the Supreme Court’s ruling. The Norwegian government holds a 53.97% share in Telenor and it is understood that the Norwegian embassy has begun discussing the matter with the Indian government. Telenor’s legal team are exploring all options to fight the decision, including filing a petition and suing the telecoms ministry for damages.

India, Norway, Telecom Regulatory Authority of India (TRAI), Telenor Group, Telenor India