Next spectrum auction likely in April-June 2020

MUMBAI: The authorities is engaged on holding essential telecom spectrum auctions, the place it expects to promote each 4G and 5G bandwidth, in April-June subsequent 12 months, mentioned individuals with information of the matter. “Final timelines have not been frozen yet… this is the tentative schedule,” considered one of them mentioned.

The authorities believes that tariff will increase by the three non-state telecom operators together with a two-year moratorium on spectrum funds will give carriers sufficient monetary power to take part within the sale.

However, the operators nonetheless preserve that base costs prompt by the Telecom Regulatory Authority of India (Trai) are too excessive, particularly for 5G airwaves, and wish sale deferred.

Telecom minister Ravi Shankar Prasad just lately informed parliament the federal government received’t scale back the 5G base value as pegged by Trai. The Digital Communications Commission, the best decision-making physique within the telecom division, is about to fulfill shortly and will think about points concerning the airwaves sale, together with pricing.

The authorities has made clear it received’t public sale frequencies piecemeal, and that every one out there spectrum will probably be put up on the market.

The individual mentioned telcos want bandwidth, particularly with a few of their airwaves expiring in 2021. “It is up to the government to hold the auctions, and it’s up to the operators to participate,” a second individual mentioned.

On supply will probably be 8,293.95 MHz of 4G and 5G spectrum, which might fetch the federal government about Rs 5.86 lakh crore, if all of it’s bought at base value.

“If operators can bid for spectrum of insolvent companies like Reliance Communications (RCom), it means they need spectrum to run their network and therefore can participate in auctions as well,” mentioned one other individual conscious of the developments.

“Those whose spectrum bands are nearing the expiry date will need more airwaves.”

Analysts mentioned Jio wants an early public sale of 4G airwaves since a sizeable chunk of RCom airwaves within the coveted 800 Mhz band—which the Mukesh Ambani-led telco makes use of beneath a sharing pact–will expire in 18 circles in July-August 2021.

They added that Bharti Airtel and Vodafone Idea may also want to purchase again their expiring airwaves in eight circles every, however largely within the cheaper 1800 MHz band, additionally used for 4G.

But it’s the value of the 5G band — seen as key to the subsequent part of progress in telecom — that the business fears will push them into additional debt.

The sector regulator has prompt a base value for 5G airwaves of Rs 492 per MHz and has proposed a minimal sale of 20 MHz blocks. That would imply a telco having to spend near Rs 10,000 crore for 20 MHz and Rs 50,000 crore for 100 MHz–rates that the businesses have mentioned are exorbitant.

“Prices are still not appropriate and if the government decides to conduct auctions in next few quarters, it will push back the industry into further debt,” mentioned Rajan Mathews, director normal of the Cellular Operators Association of India (COAI), which represents Bharti Airtel, Jio and Vodafone Idea. He added that the current value hikes have been meant to deal with the AGR impression and won’t be sufficient to assist with paying for airwaves at public sale.

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