Panel report: Too little 5G spectrum in India at very high price, needs correction

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Fe Bureau | Published: August 24, 2018 4:59:23 AM

While the department of telecommunications has identified 200 MHz spectrum in the 3400-3600 band, which is for 5G services and earmarked auctioning 175 MHz, with the balance 25 MHz to be reserved for use by ISRO, an expert panel on 5G road map appointed by it, finds this amount to be scarce.

5g, 5 g spectrum, spectrumThe report, which was released on Thursday, has noted in regard to the availability of 5G spectrum, “India’s quantum of spectrum allocation needs a big fillip.

While the department of telecommunications has identified 200 MHz spectrum in the 3400-3600 band, which is for 5G services and earmarked auctioning 175 MHz, with the balance 25 MHz to be reserved for use by ISRO, an expert panel on 5G road map appointed by it, finds this amount to be scarce. It also finds the cost of spectrum high in the country and wants the government to set this right.

The report, which was released on Thursday, has noted in regard to the availability of 5G spectrum, “India’s quantum of spectrum allocation needs a big fillip. For example, total licensed mobile spectrum is about 220 MHz compared to 608 MHz in the USA and 353 MHz in the UK. Further, the cost of spectrum, relative to per capita GDP, is much higher than most countries. Both these factors drive up infrastructure costs. Also, in recent years, the high cost of spectrum has left large quantities of unsold spectrum. It is important that India corrects these anomalies in 5G.”

The Telecom Regulatory Authority of India (Trai), which earlier this month recommended reserve price for the next round of spectrum auctions across bands, has fixed a reserve price for 5G band at Rs 492 crore per MHz. This means that for a pan-India minimum block of 20 MHz, operators will have to shell out Rs 9,840 crore, a price which is seen as steep by the industry considering that in the South Korean auctions for this band a month ago, the price per MHz was just Rs 130 crore.

The report has also said that 5G networks will need new business models and bring higher risks to service providers, so the government should offer a comprehensive support package. “One example of support can be to designate 5G networks as essential infrastructure and allow telecom service providers access to capital at lower cost. Another example is to formulate a policy for public-private partnerships in innovative but high-risk 5G deployment. Yet another example is to provide economic viability gap grants for rural deployments using unutilised USO funds,” the report has said.

The report by the expert group has said it is important to ensure that spectrum is auctioned at a reasonable price. “It is important to study global trends and come up with suitable pricing for Indian market,” it has observed.

The high-level panel was set up in September last year and was headed by Stanford Professor AJ Paulraj. It has given its recommendations on various aspects related to the deployment of 5G.

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