Reports: India starts readying next 5G spectrum auction

Almost a year after the first 5G auction, the Indian Department of Telecommunications (DoT) has initiated the process for the second round of 5G spectrum auctions by asking the Telecom Regulatory Authority of India (TRAI) to discover the reserve price for spectrum in different frequency bands, according to media reports.

Apart from the unsold spectrum from last year’s auction, the government plans to put spectrum from various bands, including 600MHz and 37GHz frequency bands, on sale. Getting the recommendations from TRAI on the pricing of spectrum is the first step of the auction process.

The government earned a record 1.5 trillion Indian rupees ($18.19 billion) in last year's 5G spectrum auctions with Reliance Jio investing the maximum amount of INR880.78 billion ($10.68 billion) to acquire 24,740MHz of spectrum, including pan-India spectrum in the 700MHz frequency band. Jio was followed by Airtel, which bought 19,867.8MHz of spectrum for INR430.84 billion ($5.22 billion). Vodafone Idea, on the other hand, acquired 6,228.4MHz for INR187.99 billion ($2.2 billion) and Adani Group, a surprise entrant, bought 400MHz for INR2.1 billion ($25.72 million).

Monetization troubles

Even as the government gears up for the second round of 5G spectrum auctions, there seems to be little or no demand for more spectrum from the industry. Since the auction in August last year, the Indian telcos have rolled out 5G at breakneck speed, with Jio and Airtel recently announcing that they have achieved the minimum rollout targets using 26GHz in all 22 circles (service areas). It is unclear whether Jio has started using the 700MHz spectrum to deploy 5G.

The 5G ecosystem has, however, only now started to develop in the country, with Airtel announcing earlier this year that it had reached the milestone of 10 million 5G subscribers. As of December 2022, India had recorded 10 million 5G subscribers, as per data shared by the government in parliament.

Further, the telcos have repeatedly raised concerns regarding the monetization of 5G. As of now, both Jio and Airtel are offering unlimited 5G at 4G rates.

In this context, it is hard to imagine that they would be keen to slug it out for additional spectrum. With monetization potential limited, the bidding is going to be muted for the second round of auctions. Moreover, it is likely that only the top two telcos, Jio and Airtel, will participate.

While Vodafone Idea did take part in the last 5G spectrum auction, its financial condition is now much worse and it is yet to launch commercial 5G services. In all likelihood, this means it won’t actively participate in the second round of auctions.

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— Gagandeep Kaur, Contributing Editor, special to Light Reading