TRAI Needs to Lower Reserve Price of 5G Spectrum

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For the industry to proceed ahead with the 5G developments peacefully, the telcos need to know the new reserve price of the 5G spectrum (3300 MHz - 3600 MHz). There is no doubt that the Telecom Regulatory Authority of India (TRAI) will cut the reserve price of the 5G spectrum; the only question is what will be the final price.

The telcos need the 5G spectrum at an affordable rate so that they can make the network rollout feasible, which in turn will make it affordable for the end consumers of the technology to purchase services. According to a FinancialExpress report, the government is also of the same view that the sector regulator should bring down the prices of the 5G spectrum.

TRAI Must Consider 700 MHz Band’s Price Too

It is not just the airwaves in the 3300 MHz - 3600 MHz bands but also the 700 MHz band that will need to be availed to the telcos at a revised price. This is because none of the telcos purchased a single block of airwaves in the coveted 700 MHz band in the recently held spectrum auctions because of its unfairly high reserve price.

The Department of Telecommunications (DoT) doesn’t want to take any more chances and wants TRAI to reconsider the pricing of the airwaves. One of the biggest reasons why the government is worried about the 5G spectrum not selling is that the telcos haven’t shown any pressing need for the spectrum.

Only two operators are expected to majorly bid for the 5G spectrum - Reliance Jio and Bharti Airtel. Vodafone Idea’s (Vi) 5G plans are a little unclear at the moment. Even then, these two operators can use the spectrum meant for 4G services and optimise it for 5G to roll out commercial 5G networks.

Even though this wouldn’t allow India to get the best out of 5G, the operators won’t have to spend huge sums of money on the spectrum and can wait longer till the time the reserve price of the spectrum is reduced.

The regulator had recommended Rs 492 crore per MHz as the reserve price of the spectrum in the 3300 MHz - 3600 MHz bands. Since the telcos can’t buy a block shorter than 20 MHz, it meant that for acquiring a single block in the 5G spectrum band, they would have to spend a minimum of Rs 9,840 crore.

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