TRAI on 27th Jan 2016 recommended that the 700 MHz band should be priced at 4 times that of 1800 MHz band at 11,485 Cr/MHz (Pan India). This translates into a price of 1.93 times that of 800 MHz band, 1.32 times that of 900 MHz band, and 3.12 times that of 2100 MHz band. TRAI in its recommendation had observed that valuation based on only technical efficiency with other bands will not be the correct approach as it ignores all other factors i.e development stage of the ecosystem, market preference towards any particular band, timing of auction etc. Hence, instead of linking the price of 700 MHz with 800 MHz (which is the nearest band with similar propagation characteristics), it invoked its earlier recommendation of April 2012 where it had suggested that 700 MHz band price should be around four times that of 1800 MHz band (Page 97/98 of clause 3.75 of TRAI’s recommendation dated 27th Jan 2016).
DoT vide its letter dated 1st April 2016 asked TRAI to clarify whether the various factors as indicated by it has been taken into consideration while arriving at the reserve price of 700 MHz band. DoT has emphasised (in its back reference) that propagation characteristic of 700 MHz band is closer to 800/900 MHz than 1800 MHz band (clause “f” page 31/32 of TRAI’s clarification dated 18th April 2016).
