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Telenor to Take Final Call on Spectrum Auction After Pricing

Telenor to Take Final Call on Spectrum Auction After Pricing

By Press Trust of India | Updated: 11 February 2016 13:37 IST

Norwegian telecom firm Telenor Wednesday said it may participate in the next round of spectrum auction but will take its final call only after the government decides on the pricing.

The company will also explore option of buying or sharing airwaves for wireless services with other telecom operators under spectrum trading and sharing rule as it looks to boost its operations in India, Telenor Group President & CEO Sigve Brekke said.

"The future of our Indian operations will depend on additional spectrum. There is a planned auction coming in May-June and we are going to have a pragmatic and prudent way of looking at that as an opportunity," Brekke said during the webcast of Telenor Group financial report.

The Telecom Regulator Authority of India has recommended spectrum pricing for seven bands, including the premium 700 Mhz frequency at record base price of Rs. 11,485 crore per Mhz, for the next round of auction which could fetch the government a staggering Rs. 5.36 lakh crore.

"What I have seen from regulator and prices so far is that they are planning to put a lot of spectrum on auction.

Prices for lower band is good too high, however price for higher band such as 2.3 Ghz is more reasonable," Brekke said. Trai has recommended a base price of Rs. 817 crore per Mhz on pan-India basis for 2.3 Ghz band.

Telenor was one of the companies that strongly advocated for auction of 700 Mhz band while leading telecom players - Airtel, Idea, Reliance Jio - suggested to defer it.

"We will look at this once the spectrum prices are decided but we are going to take very pragmatic and prudent approach. We will also look at other possibilities such as spectrum sharing and trading which is now allowed," Brekke said.

Telenor India's operating loss widened to Rs. 460 crore or 368 million Norwegian krone (NOK) for the fourth quarter ended December 31, 2015 from operating loss was Rs. 358.53 crore during the same period a year ago.

For the year ended December 2015, the operating loss of Telenor India stood at Rs. 1,236.75 crore.

"I also want to make it clear that if we cannot justify the spectrum prices going forward then we will have figure out all the other alternatives," Brekke said.

Average revenue per user (ARPU) of Telenor India in local currency fell by 13 percent to Rs. 88 primarily driven by lower voice consumption and the impact from reduced mobile termination rate, partly compensated by increased data usage.

"The whole is market is now turning from voice into data and that is the reason we see little pressure on ARPU however our India operations are holding up quite nicely," Brekke said.

Telenor India's quarterly revenue increased by 21 percent on year-on-year basis and annual revenue by 33 percent.

The firm's revenue during the reported quarter increased to Rs. 1,806.4 crore from Rs. 1,493.25 crore in the corresponding period of 2014.

However, the annual revenue of the company increased by 33 percent to about Rs. 6,969.8 crore in 2015 compared with Rs.5,237.3 crore in 2014, it added.

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