Videocon Mobile shares response on TRAI recommendations

In regard to the TRAI recommendations on cut in mobile spectrum auction floor price, a statement has been given by the Director and CEO of Videocon Telecommunications, Arvind Bali.

He stated, We feel that the recommendations recognize and reconfirm the fact that the reserve price fixed for the November 2012 auction was wrong and those who bid for spectrum in the said auction have paid prices which are exorbitantly high and would not support their business case. It may be recalled that Videocon Mobile Services was compelled to bid at this exorbitant price during the November 2012 auction to ensure continuity of business since more than $2 billion was already sunk into the business. We have already been penalized once, where despite coming out clean, our 2G licence in 21 service areas was quashed and we also lost approximately 7 million subscribers, needless to say the monetary loss running to the tune of $2 billion, and now the spectrum that we recently acquired has already become cheaper.

He added, We strongly recommend that the excess money paid by us, i.e. difference between the price paid by us and the successful bid price of the upcoming auction should be refunded back to us either in monetary terms or through additional spectrum.

There is every possibility that the successful bid price of the spectrum in the current auction may not even touch the reserve price of the November 2012 auction. In the event of that happening, those who bid in November 12, including Videocon Mobile Services will continue to be at a disadvantage and there will never be a level-playing field.