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5G Auction: Telcos likely to buy spectrum worth up to Rs 1 lakh crore

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5G Auction: Telcos likely to buy spectrum worth up to Rs 1 lakh crore

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The telcos are expected to move fast for rolling out 5G services which are expected in India's urban centres by mid-2023, said the sources.

The government is expecting to earn Rs 80,000 crore to Rs 1,00,000 crore by auctioning 5G airwaves in July, sources told CNBC-TV18 on Friday. A total of 72 gigahertz (GHz) of spectrum with a validity period of 20 years would be put to auction.
However, a report by a research firm indicated on Thursday that a vast majority of the spectrum is likely to remain unsold. IIFL Securities has said that the three telecom operators — Reliance Jio, Bharti Airtel, and Vodafone Idea — will likely spend only about Rs 71,000 crore in the auction.
The auctions are likely to start on July 26 and the Department of Telecommunications (DoT) has already released a notice inviting applications for the same.
The DoT's proposal to hold a mega 5G spectrum auction to roll out services which are expected to be 10 times faster than 4G was approved by the Union Cabinet earlier this month. Though the Telecom Regulatory Authority had reduced the prices by 40 percent than what it had recommended earlier, telcos wanted the price to be slashed further.
The auction will be held for spectrum in low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz), and high (26 GHz) frequency bands.
According to sources, demand is good in the mid- and high-frequency bands.
"It is expected that the mid and high band spectrum will be utilised by telecom service providers to roll out 5G technology-based services capable of providing speed and capacities about 10 times higher than what is possible through the current 4G services," the government had said earlier.
It would levy a zero spectrum usage charge (SUC) on the spectrum acquired and the telecom operators will not be required to make an upfront payment. The dues can be paid in 20 equal instalments.
The telcos are expected to move fast for rolling out 5G services which are expected in India's urban centres by mid-2023, added the sources.
According to a recent report by telecom hardware company Ericsson, by 2027, 40 percent of subscribers in India will be on 5G networks. The report also estimated that by 2027, 56 percent of total mobile traffic in India will be carried by 5G networks.
Disclosure: RIL, the promoter of Reliance Jio, also controls Network18, the parent company of CNBCTV18.com.
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