5G Roadmap: Telcos tell Trai to identify clear and contiguous spectrum for 5G auctions

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October 25, 2021 4:30 AM

The reserve price for 5G spectrum, announced in 2018, was felt to be very high. However, auctions for 5G were not held in March 2021 but were conducted for other 4G bands.

Trai is expected to soon come out with a consultation paper on the auction, specifying the bands and quantum to be put up for sale.Trai is expected to soon come out with a consultation paper on the auction, specifying the bands and quantum to be put up for sale.

Telecom operators have urged the Telecom Regulatory Authority of India (Trai) to earmark only unemcumbered blocks of spectrum for the 5G auctions asking it to make sure the spectrum is not in use by any government department and has been vacated.

Moreover, they have requested Trai to auction spectrum that is contiguous. In their meetings with the regulator, in what can be called a pre-consultation process, operators have reiterated their demand for a new pricing methodology for the reserve price. The government plans to auction 5G spectrum in the first half of CY2022.

Trai is expected to soon come out with a consultation paper on the auction, specifying the bands and quantum to be put up for sale.

The reserve price for 5G spectrum, announced in 2018, was felt to be very high. However, auctions for 5G were not held in March 2021 but were conducted for other 4G bands.

In 2018, Trai had recommended a reserve price of Rs 492 crore per MHz for the 3300-3600 MHz band. should it stay with this,operators would need to shell out Rs 9,840 crore for a pan-India minimum block of 20 MHz. As telcos need about 100 MHz to offer pan-India 5G services, the cost would work out to around Rs 49,200 crore.

Telecom executives have pointed out that given there are just three players, a realistic reserve price could see the spectrum sold at the reserve price itself. A realistic price, on the lower side, they say, would lead to a faster rollout of services.

Currently, the defence forces are using some spectrum in the 3300-3400 MHz band. The operators want the forces to vacate this before this spectrum is auctioned.

Recently, Bharti Airtel chairman Sunil Mittal also spoke about the need to explore alternate models of spectrum pricing rather than using the last auction-determined price as the reserve price.“Spectrum should be priced appropriately for India. If you go back to 2010 auction of 3G and BWA, that was the starting point of the problem. Pricing went 5-6-7 times from the reserve price that became the bane of this industry as there were 6-7 players for three slots. Now whatever reserve price you put, spectrum will mostly go at that as there are not many competitors now,” Mittal said.

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