Spectrum Auctions to Start Today, First Time in 5 years

The Indian Government will commence the mobile telecom airwaves auction for the first time in 5 years starting Monday i.e., 1st March 2021. The auction will be held for about 2250MHz of spectrum worth approximately Rs. 4 lakh crore at the reserve price. The entire spectrum will be sold across different bands. The specified 5G sale will be conducted later. 

Different telecom firms will take part in the auctions. The auctions will provide different companies that include Bharti Airtel, Reliance Jio, and Vodafone Idea to enhance their telecom holdings. Besides this, the companies will also be able to purchase back replacement spectrum for specific airwaves, the term of which is wrapping soon.

Spectrum Auctions to Start Today, First Time in 5 years
Spectrum Auctions to Start Today, First Time in 5 years

In December 2020, the Union Cabinet had permitted the much-anticipated sale. The government that has been conflicting fund shortage and a broadening financial deficit on COVID-19 relief measures would be expected to wash up funds for the exchequer via the process. Still, the telecom firms made it obvious that their bidding may not be that ardent as they continue to be fiscally challenged and would try to fill gaps in their spectrum holdings. 

Several analysts have brought up doubts regarding the sale in the 700MHz band. They say that this band is profitable for deployment. However, it will be truly expensive. The government had strived to augment some excitement to the sale by permitting companies to make certain changes to technology advancements and upgrades with a notice of only 6 months. The government assumed that this could enable them to roll out 5G services on the previous airwaves with constrained capabilities. 

It means that the firms which augment an adequate amount of airwaves can roll out 5G services before the sale of the specialized spectrum assigned for the high-speed mobile services. Bharti Airtel has already showcased a limited 5G launch on existing airwaves recently in Hyderabad i.e., in late January 2021. The company stated that it is waiting for approval from the telecom department to launch it commercially. 

In India, the leading telecom operator Reliance Jio, Bharti Airtel, and Vodafone Idea have submitted a total earnest money deposit [EMD] of Rs. 13475 crore for the auctions, said the telecom ministry in February 2021. The industry body,  Cellular Operators Association of India [COAI] said that the auction will aid address the need for more spectrum considering the developing consumer usage. The industry lobby group stated, ‘lower reserve prices would have provided additional resources for network expansion to the telcos.’ 

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