Spectrum Auction for 5G Radiowaves Will Likely Take Place in H2 2020: Moody’s

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The proposed spectrum auctions in India, which includes radiowaves for 5G technology, are likely to be held only in the second half of 2020 or later, given the stressed balance sheets of telecom operators, Moody's Investors Service said Thursday. "Regulators in countries such as India, Indonesia, and Bangladesh are still initiating consultations with operators and are likely to schedule 5G spectrum auctions only in the second half of 2020 or later," Moody's Investors Service said in a report.

It said that the Indian government had identified the 5G spectrum (3.3-3.6 GHz).

"However, sale of spectrum in 2019 is unlikely, especially given the telcos' request to the government to restructure their existing spectrum debt in light of their stretched balance sheets," the report said, as reported by PTI.

All telecom operators, except Reliance Jio, have been under pressure due to huge debt and decline in margins.

According to Crisil, telecom players in India are reeling under cumulative debt of around Rs 4.3 lakh crore.

The Telecom Regulatory Authority of India (Trai) has recommended auction of about 8,644 MHz of telecom frequencies at an estimated total base price of Rs 4.9 lakh crore, which includes radiowaves for 5G services.

"Even though there are signs of market recovery this year, severe price competition in India and Indonesia is leading to an acceleration in capex plans for companies. Although 5G spectrum allocation timelines are still being discussed in these countries, we expect all companies to participate in these spectrum auctions," Moody's said.

Telecom operators in India, Indonesia, and Bangladesh continue to focus on further strengthening and densifying their 4G networks.

The report said that most of the countries in the Asia-Pacific region are offering spectrum at low prices to help companies leapfrog into 5G services, and to incentivise operators.

"India seems to be an exception given spectrum pricing is still quite contentious," the report added.

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Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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