Reliance Jio in Support of Early 5G Spectrum Auction; Vodafone Idea and Airtel Urge for Price Reduction

While Bharti Airtel and Vodafone Idea want the prices of the spectrum to be reduced and an auction at a later stage, Reliance Jio is in support of Trai's recommendations

Highlights
  • Trai proposed a sale of 20 MHz blocks of 5G spectrum in the 3,300-3,600 MHz band at Rs 492 crore per unit
  • Trai has also suggested a 43% cut to Rs 6,568 crore for the 700 MHz unsold spectrum

There has been a massive divide in the opinions of telecom operators in the industry about whether or not the 5G spectrum auction should be held in 2019. A lot of the telecom operators are against it and are asking for a reduction in prices recommended by the telecom regulator, whereas some players in the industry deem the prices and the early auction as an appropriate step. A new ET Telecom report has highlighted that while Vodafone Idea and Bharti Airtel stand together against the early auction and have called the prices of the 5G spectrum as “exorbitant”, Mukesh Ambani led telecom operator, Reliance Jio is backing the sale of 5G spectrum in 2019 at Trai recommended rates.

Bharti Airtel and Vodafone Idea Ask for Delayed 5G Spectrum Auction

An Airtel spokesperson has said about this new development, “In any auction in the future, Bharti Airtel will participate to pick up small chunks of 4G spectrum in certain circles. On 5G, it will depend on the pricing, which we hope will be set at prices which encourage more investments in networks rather than spectrum purchase.”

The Airtel official also added, “Spectrum is the lifeline of the mobile industry. Bharti Airtel has, through participation in various auctions and through merger and acquisitions, created one of the largest pools of spectrum in the industry.”

Airtel’s CEO, Gopal Vittal has also called out against the prices saying that they are too high given that the 5G ecosystem is in nascent stages. On the other hand, Reliance Jio has contrasting views about the government’s decision of holding the 5G spectrum in 2019 only. A person close to Reliance Jio remarked about this, “The prices have been decided after much deliberation by the sector regulator, and if a telco needs the spectrum, then it will bid for it during the auction irrespective of the costs.”

New Telecom Minister Announces Spectrum Sale in 2019

The clash of opinions over the expected date of 5G spectrum auction and also on the prices began when last year, the Telecom Regulatory Authority of India (Trai) proposed a sale of 20 MHz blocks of 5G spectrum in the 3,300-3,600 MHz band at a price of Rs 492 crore per unit. There was also the 700 MHz band pending for sale which had gone unsold last year due to high prices, for which Trai had suggested a 43% cut, to Rs 6,568 crore a unit. Now even with telecom operators pressing the regulator to lower the recommended prices, the Trai has backed its number by saying that it has arrived on them through extensive consultations.

Vodafone Idea and Bharti Airtel have said that 5G spectrum auctions should only be held later next year and at lower prices than what Trai has suggested. On Monday, new telecom minister Ravi Shankar Prasad announced that the auction of 5G spectrum airwaves would be held later this year.

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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Vinayak5G fastAniruddha Dhar|Santragachi|West BengalavinashsuwalThamilan daa Recent comment authors
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Kiran Fernandes | Goa
Kiran Fernandes | Goa

Waiting for September to arrive. I wanted the auctions to be in September 2018, but they failed to have it. Now Jio is gonna suffer because Rcom will lose their licence to band 5 spectrum. Let’s hope the telecom dpt allows Jio to continue the spectrum till the auctions. I just can’t wait for the auctions. Wake me up when September ends….. 😀 😀

avinashsuwal
avinashsuwal

Summer has come and passed
The innocent can never last
Wake me up when September ends LoL 😛

avinashsuwal
avinashsuwal

i think it should be wake me up when auction ends 😛

Kunal
Kunal

Airtel will buy 5g spectrum if Jio is buying in the next auction. They will not let the competitor move ahead . Airtel will loose it’s premium customers to Jio 5g & In any case , if Jio buys 5g spectrum in all available bands in the present auction, then that price will remain the base price for the next auction , whenever it happens . Don’t see Airtel avoiding 5g spectrum purchase. They will pressurise the government to reduce the base price which is their right. But will have no option but to buy to remain in competition against… Read more »

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

Frankly speaking we doesn’t need 5G yet. Jio can turn around 5G game within six months. Trails only should happen for 5G.4G spectrum should be sold completely in this auction. 5G can be deployed by 2021. I personally think there is no need for 5G yet.

Arena
Arena

Yes…India needs massive spectrum b.w for 4g. 5g will be no different is 20mhz blocks sold. 5g means minimum operational b.w must be 100mhz. Rule of thumb more b.w per userbase= more speed. Irrespective of tech (4g,5g). Also it takes upto 2022 for equipment upgrade and Device market.

Kiran Fernandes | Goa
Kiran Fernandes | Goa

Nikhil, actually Ambani wants to move to 5G asap because he wants india to have the best network as the world is moving to 5G. Yes it’ll take a while to set up the towers for 5G, but by 2022, there’ll be complete 5G coverage all over India. When you hear that Ambani finds the prices perfect, you know that he has ample cash to burn on spectrum and on towers. Looks like 4G paid off In 2012, Airtel had the first mover advantage with 4G, and the Airtel fanboys kept blabbering on how good Airtel was for their first… Read more »

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

@Kiran You are too much optimistic. There is difference between wanting and in reality to do things. Even if Jio gathers spectrum,it will be 2022-2023 to have decent coverage of 5G to work in cities. Don’t expect before that. You know how much time he took to set up 4G network. Yet no sign of Jiofiber. And it’s 5G. Technology upgrade. Even developed countries have 5G network in handful of cities till now. It’s just start. I can’t see network growing up till 2025. I personally don’t see Jio 5G network very soon. Also there will be raise in prices… Read more »

Vinayak
Vinayak

Other than the existing bands will any other Bands be up for sale with the exception of 700MhZ? Any info on that? I am talking with respect to 4G spectrum.

Thamilan daa
Thamilan daa

It is not doesn’t. It is do not.

Aniruddha Dhar|Santragachi|West Bengal
Aniruddha Dhar|Santragachi|West Bengal

‘It’ is a third person singular number. So the correct form is “it doesn’t”.

Chetan -bengaluru
Chetan -bengaluru

AIRTEL will buy spectrum but selectively. Only in its leadership circle. It doesn’t have money to buy adequately in all circles…

saket
saket

Mr chetan, then airtel will again fall on its face, because it has done in case of 3g.

I mean 3300Mhz , minimum block is 20Mhz and required block is 100Mhz
and 700Mhz, minimum block is 5Mhz.

So airtel will definately doing circle wise selection. but will be Pan indai 5G spectrum ready, network may not launch for next 6-12 months

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

Airtel will buy 700Mhz(10Mhz) only for coverage for time being. Their 4G capacity is mostly unused. No need of 3300Mhz even for two years. Not even 20Mhz block. Airtel might buy band 40(10Mhz) PAN India. Rest will be bought by Jio along with band 3. Don’t know whether Jio is interested in band 1 spectrum. Lot of spectrum is left in that band too. Airtel might eye that as Vodafone-Idea is almost done and dusted for buying spectrum. Jio is the only company who needs spectrum. Airtel needs band 8 but it is completely at BSNL. BSNL should give up… Read more »

Arena
Arena

Yes…BSNL is a burden on tax payers. They cant compete. They should focus on infra leasing business and organisation to organisation support. End customer business is no longer their game.

5G fast
5G fast

BSNL is not burden on tax payers. BSNL is a PSU. It is running on its own money not on taxpayers money

Esmail

700 MHz band has 35 MHz available for telecom, not 40 MHz.

saket
saket

So this mean even after sufficient spectrum of 35Mhz, due to high price it may remain partially unsold. if not fully unsold.

Esmail

This time it won’t remain unsold since it’s base price has been slashed by over 43% compared to the 2016 auction. Jio will be willing to pick up at least 10 MHz pan India since the Rcom spectrum in 850 MHz band is under jeopardy and they will need low frequency spectrum for blanket coverage.

Nikhil Mumbai-Pune
Nikhil Mumbai-Pune

Jio can’t buy it fully just like 850Mhz. It can buy 20Mhz at the most I guess. Esmail can clear the rules to have maximum sub-Ghz spectrum. As Jio will hold all the band 5 Spectrum,Jio cannot have full access to 700Mhz airwaves.

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