Spectrum auction: PTA accepts bids for 3G, 4G licences

Authority denies report on sluggish response to auction.

ISLAMABAD:

The bids of four leading telecom operators for the auction of 3G and 4G licences, was accepted by Pakistan Telecommunication Authority (PTA), raising prospects of generating over $1.3billion in revenues for the public purse.

After intense scrutiny, the telecom regulator on Thursday announced the names of successful bidders which are; China Mobile (Zong) PTML (UFone), Mobilink and Telenor Pakistan. However, Warid Telecom Pakistan, owned by the privately-held conglomerate Abu Dhabi Group, did not participate in the bidding process.

According to details, the four telecom giants will now compete for three 3G licences during the auction slated for April 23. “As the demand exceeds supply, the allocation of the spectrum will happen through an auction process,” PTA officials said.



Conversely, the regulator did not disclose the amount and types of bids that were submitted by the operators.

Commenting on the process, a senior PTA official said that the types of bids and amounts will not be revealed till the results are out. He added that the outlined auction procedure prohibits the operators from knowing the details related to bids submitted by other operators.

With no new entrant participating in the process and the 2G licence — priced at $290million and reserved for new entrants — not being auctioned, the government’s original estimates of generating up to $2 billion through the auction have dropped to $1.3billion.

In an effort to shore up foreign investment, the government had initially made frantic efforts to convince telecom giants from Turkey, Qatar and Saudi Arabia to participate in the bidding process for the new telecom spectrums.

While talking to The Express Tribune, Minister for Information Technology Anusha Rehman said that despite no new entry in the country’s telecom sector, the government hopes it would generate over $1.3 billion from the auction of next generation spectrums.



Rehman said that the government did not accept foreign players’ offer because of their condition to oust existing companies from the process of auction.

Expressing cautious optimism, Rehman further said, “We are happy with the results so far. Everything is going smoothly and transparently. The prime minister is directly supervising the process.”

On Wednesday, a Supreme Court bench headed by Justice Jawwad S Khawaja ordered that the proceeds of the auction should be kept in the Federal Consolidated Fund (FCF) until it settles a dispute about the custody of the Universal Services Fund (USF).

During the court proceedings, PTA Chairman Syed Ismail Shah refuted media reports about dismal response from bidders. He said the sale was necessary because the demand was higher with respect to the radio frequency spectrum put on offer by the regulator.

The PTA chief said the next six days were crucial but misreporting might adversely impact the auction scheduled for April 23 by encouraging outsiders to seek a stay order from the court.

Published in The Express Tribune, April 18^th, 2014.