Spectrum auctions in India: lessons from experience

Spectrum auctions have been used with significant success in many developed countries. The key challenge before regulatory agencies is to design auctions in such a way as to meet the objective of fostering competition while at the same time ensuring that bidders can effectively use the spectrum for their business. While India was one of the early adopters of spectrum auctions, its success in service provision has been low. This paper critcally examines issues in auction design that contributed to this delay and reviews the key elements in the design process - namely a coherent regulatory framework, choice of service areas, flexibility for service area consolidation, standards and their role, convergence, managing public service regulation and managing defaults. The paper compares the handling of these elements in auctions in the US, UK and Australia with the objective of drawing lessons from Indian policy makers.