4G Spectrum Auction Process Started Formally by DoT, Jio to Be the Main Buyer

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The 4G spectrum auction will take place in March 2021 in India. It has been delayed a long time, but the formal process for the auction has been kicked off by the Department of Telecommunications (DoT). DoT has started issuing notice inviting applications (NIA) to the operators. The NIA comprises of all the license conditions and rules regarding the auction. In the upcoming 4G spectrum sale, Jio will largely look to purchase maximum airwaves amongst all the operators. At the same time, Airtel and Vodafone Idea (Vi) are likely to have more of a laid-back approach — more details on the story ahead.

4G Spectrum Auction Might Result in Rs 3.92 Lakh Crore Going into the Pockets of Government

It is worthy to note that the upcoming 4G airwaves auction will include the 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, and 2500 MHz bands. Bharti Airtel and Vodafone Idea have spectrum backups in multiple circles which they can rely on if they don’t want to spend too much money.

As per a report from ET Telecom, Jio is expected to show maximum participation in the auctions. This is because the airwaves it currently has along with the ones it shares with Reliance Communications in the 800 MHz bands are going to expire in about 12 to 14 telecom circles of the country starting July this year.

Without these airwaves, the services of Jio will be impacted heavily. Thus the telecom operator will be looking to purchase airwaves more actively in the upcoming 4G spectrum auctions to continue providing seamless mobile services to its 400 million large customer base. Jio is aiming to reach 500 million subscriber mark as early as possible, and for that, the telco will need the new airwaves.

The spectrum auctions are assumed to help government pocket up to Rs 3.92 lakh crore from the telecom operators. The analysts expect Jio alone to spend between Rs 40,000 to Rs 50,000 crore in the auctions for purchasing new airwaves. At the same time, Vi and Airtel won’t be too keen on spending a large sum of money for airwaves at present.

Furthermore, the analysts believe that chances for a bidding war are less likely to happen. This is because of the Rs 7 lakh crore debt the sector is in and also because there is a large quantity of spectrum on sale. Thus Vi and Airtel might not risk bidding too much for the airwaves since they already have a solid backup.

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