The government’s revenue target from the 3G auctions exceeds Rs 30,000 crore. Telecom minister A Raja has said even Rs 50,000 crore of revenues is not out of reach. “Since these are probably the last spectrum auctions to be held in this decade, revenue maximization is a clear government objective, especially since the costs cannot be passed on to consumers”, a senior DoT official who is overseeing the auction process, told TOI.
Telcos have enormous incentive to argue that ‘expensive auctions lead to price increase’ as they obtain windfall profits if they can bag a scarce resource at a lower price.
According to experts, the competitive environment, coupled with the fact that voice still constitutes 92% of telecom revenues and SMS just 3% to 4%, makes any case for higher consumer prices for 3G implausible.
There is high probability that 3G will be used mostly for voice and for a long period of time. Other applications like video content, Bollywood, sports and Internet access will be restricted to a handful of large cities and metros between 2011 and 2014.
To know more pl.read.... Bids high....
Bids-high-but-3G-tariffs-wont-rise
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