As per the new reports coming in, India’s Department of Telecom is planning to conclude spectrum auction for the next-generation 5G communications technology by November 30. Further, it also adds that the inter-ministerial panel, Digital Communications Commission, will meet after the third week of September to finalise the spectrum auction prices.
Further, the report adds that the price is expected to be what the Telecom Regulatory Authority of India (TRAI) has recommended. The report is citing a source for this report who said that they are in the process of appointing an auctioneer soon. Ravi Shankar Prasad, Telecom Minister is hoping to complete the auction in the current calendar.
Sources also hoped that despite telecom companies crying about their financial conditions, they all would bid for the auction at base price and the government would not have any problem in raising at least the expected revenue calculated on the base price and the fully sold spectrum.
In August last year, TRAI had recommended auction of about 8,644MHz of spectrum across bands at an estimated total base price of ₹4.9 lakh crore, but the industry said the proposed prices were unaffordable and exorbitant.
For instance, for the 5G band in the 3300-3600 MHz (5G), where prices had been given for the first time at ₹492 crore per MHz, for a pan-India minimum block of 20 MHz, operators would have to shell out ₹9,840 crore, which is seen as steep, which telecom companies say is uncompetitive.
Although TRAI had reduced the reserve price by 43 percent at ₹6,568 crore per MHz for the premium 4G spectrum, still for a pan-India 5 MHz block, operators would have to shell out ₹32,840 crore.
Going by global auction of 5G sepctrum, the price of ₹492 crore per MHz for 5G spectrum was seen on the higher side, as the South Korean auctions which happened last year had the price of ₹130 crore per MHz.
However, TRAI sources say that in India, the spectrum is given for 20 years while in South Korea, it is for 10 years. But given that current ecosystem for 5G services, even if auctions are conducted and operators win the spectrum, they will have to wait for a considerable period before it can be effectively used.