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

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

Highlights
  • Reliance Jio is pushing the government for an early spectrum auction
  • Airtel, Vodafone Idea and BSNL are against the spectrum auction right now

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.

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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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ChetanLove AirtelKiran Fernandes | GoasaketRATHEESH S Recent comment authors
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saket
saket

Moody is right upto some extendt.

I hope govt make aution in 2019,
1)to top-up and harmonised existing portfolio for liberalised 4g spectrum in all band 1,3,5,8, 40 and 41.
2) allocate 0ne block of 4g spectrum to bsnl
3) take back or clear unutilised spectrum from rcom and aircel. And add, returned spectrum from bsnl and tata

And most importantly. Issue 5g spectrum on Trial license for 1 year to Interested Telco- This means Price wont be finalised, nor license will gaurantee that Spectrum allocated would be continued in final spectrum aution to be scheduled in H2 of 2020.

@esmail, chetan comments

RATHEESH S
RATHEESH S

If not 5G spectrum auction, they should at least conduct 4G spectrum auction. Both Jio and Airtel are interested in buying 4G spectrum. To address cell coverage issue, TSPs should deploy VoWiFi at the earliest. This will address congestion in urban areas. Rationing of data on a daily basis should stop. Due to this, a lot of people are using data even when they don’t need for the sake of completing their daily quota. This is causing reduced data speeds in the evening time. By removing daily quota, data load may come down to some extent and everyone gets decent… Read more »

Chetan
Chetan

4G spectrum auction will happen for sure. Jio badly needs it. Jio will make it 10Mhz in band 3/5/28 and 30Mhz in band 40 which will be sufficinet for next two-three years. Only after 2021, as Kiran said they might try to remove daily quota. Before that it’s highly impossible. Inactive subscribers is big concerns for Jio which will be solved by April 2020.

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