ISLAMABAD  - The mobile operators are going to submit their sealed bids on Monday (today) for the next generation spectrum auction that offers 3G and 4G licences simultaneously.

Presently there are 6 blocks available with PTA to be auctioned and there are five players in the market. One block is reserved only for the new entrant and no one from the existing telecom company can bid for that but the new entrants can bid for the reserved block and for the other 5 blocks too. Sources in the telecom sector say that the government will not be able to obtain $2 billion that it is aiming and the maximum gains it can get will stand at $1.4 billion with minor up and down.

There is 30 MHz available in 2100 MHz band for 3G, 20 MHz available in 1800 band for 4G services and 7.38 MHz available in 850 MHz band for 2G service and the last one is reserved for new entrant. All the players are bound to bid for the first mentioned 2100 MHz band to qualify for the bid of 1800 MHz band that offers 4G services.

Sources told The Nation that in 2100 MHz band, a bidder can bid for at least 5 MHz and in 1800 MHz band they can bid for at least 10 MHz. The base price set for the 2100 MHz band is $29.5/MHz and it is $21/MHz for the later.

Presently there are 5 companies operating in the market and among them Warid Telecom seems not interested in bidding for the next generation spectrum auction. Most probably the remaining 4 will take part in the auction and all of them might be successful in obtaining licence for the next generation mobile services but only two will be able to get 4th generation licence.

The bids submitted today will decide, whether the next stage of auction will be held or the licences will be allotted to the bidders. The sources said that if the number of applicants exceed the number of licences available that technically are 4 then the next round of auction will start on April 23 and the bidders will have to compete to obtain a licence.

But the sources said that apparently there is no hope that the number of applicants will exceed so today might be considered the last day of auction and Pakistan Telecom Authority will decide, who to allot a licence for what.

The sources said that most probably the licences will be auctioned at the base price and the government might not meet its expectations to earn much from this auction, not at least $2 billion that it was aiming to obtain from it.

The major reason is that the licence reserved for the new entrant fall in the category of 2G technology and no company seems interested to buy a 2nd generation licence while others players in the market having 3G or 4G licences. The sources said that government claimed Turk Cell was taking interest for the spectrum reserved for new entrant but there is no evidence yet that it will submit a bid for that.