Vodafone Idea (Vi) and Adani Data Networks might be in trouble here. Both the companies bid for and won spectrum in the 2022 5G auctions. As per the DoT (Department of Telecommunications), the winners of the spectrum had to meet the minimum 5G rollout obligations. The obligation was to roll out 5G in both 26 GHz and 3.3-3.6 GHz spectrum in the first year. DoT had said that a commercial 5G launch should happen in each of the three metros and at least in one city in each of India's 22 telecom circles.
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However, both Vi and Adani Data Networks have failed to comply with the minimum rollout obligations so far. As per the rule, they have to do it by August 16, 2023. But since they haven't done so, they will be under the radar of the DoT. Whether the telecom department will impose a financial penalty or would it just take the spectrum back is something we will have to wait and see.
It is worth noting that both Vi and Adani Data Networks wanted exemptions from the telecom department to meet the minimum rollout obligations. It is unlikely that they will be offered help here. But then, the government is also the largest stakeholder in Vi right now. Its decision might be towards helping the company.
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But there is no precedence for giving such help. So this would be the first time that help is provided. Vi failed to raise funds, and the result of that is no 5G order with the vendors. The vendors are not willing to provide any further credit to Vi. Adani Data Networks took the spectrum for B2B use cases, but the company hasn't deployed it yet. The deadline date of August 16 is very close. It will be interesting to see what the government will decide to do here.
