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What are spectrum auctions?

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What are spectrum auctions?


Context:

The government has received bids worth ₹77,146 crore on the first day of the auction for telecom airwaves, exceeding its own pre-bid estimates of about ₹45,000 crore.

Background:

Airwaves worth ₹3.92 lakh crore have been put up for sale across 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands.

What are spectrum auctions?

  • Devices such as cellphones and wireline telephones require signals to connect from one end to another. These signals are carried on airwaves, which must be sent at designated frequencies to avoid any kind of interference.
  • The Union government owns all the publicly available assets within the geographical boundaries of the country, which also include airwaves.
  • To sell these assets to companies willing to set up the required infrastructure to transport these waves from one end to another, the central government through the DoT auctions these airwaves from time to time.

These airwaves are called spectrum, which is subdivided into bands which have varying frequencies. All these airwaves are sold for a certain period of time, after which their validity lapses, which is generally set at 20 years.

InstaLinks:

Prelims Link:

  1. What are spectrum auctions?
  2. Objectives of the sale.
  3. Need for a new spectrum auction
  4. Who can participate in auction?

Mains Link:

Spectrum auction in India has turned into a buyer’s market. Discuss.

Sources: the Hindu.

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