The department of telecom (DoT) is pressing the telecom regulator to submit its recommendations on the reserve price of 5G spectrum by early March so that the auctions are held by May-end.
The DoT said the PMO wanted the operators to launch the 5G service by August 15, which is the nation's 75th Independence Day.
In its letter to the Telecom Regulatory Authority of India (Trai), the DoT said: “In reference to decision/action points emanating from deliberations of a monitoring group, the PMO has requested the DoT to work towards the initial launch of 5G by August 15, 2022 and also explore the possibility of obtaining requisite recommendations from Trai before March 2022. In view of the above, Trai is requested to expedite the matter and provide the recommendations at the earliest.”
With days left to finalise its recommendations, Trai is weighing up the suggestions of the operators on the issues raised in its consultation paper circulated in end-November.
The operators have not only pitched for a cut in the 5G reserve price by over 90 per cent but also a moratorium of at least five years to six years with no upfront payment.
The industry itself is divided on certain issues such as satellite spectrum and the bundling of E-band with 5G spectrum. Trai needs to arrive at a common ground quickly to meet the deadlines set by the government.
Satellite players such as Tata group’s Nelco, Viasat, industry bodies ISpA (Indian Space Association) and SIA (Satellite Industry Association) have opposed the proposals of the telecom operators especially Reliance Jio in the consultation paper.
Jio wants more spectrum for sale in the mid-frequency band. India’s No. 1 operator by subscribers has also demanded the auction of the entire C-Band (3300-4200 MHz).
Along with Vodafone Idea, Jio wants the auction of the existing frequency range of 24.25Ghz to 28.5Ghz. “It should be aimed to bring the remaining 28.5GHz to 29.5Ghz also for auction for IMT purposes,” Vodafone Idea said.
ISpA, which represents satellite players such as Hughes, Nelco and OneWeb, has pointed out that the spectrum allocated for telecom cannot be compared with satellite as the technologies are different.
Besides, there are no precedents of spectrum assignment by auction to satellite services in the mid- and high-frequency range in any country. The satellite players have unanimously demanded the reservation of the entire frequency range between 27.5-29.5 Ghz for themselves to provide broadband services.
Telecom operators has also sought clarity on the unencumbered spectrum for auction. The networks of all operators can be made service-ready in a few months as all of them have upgraded to 5G.
With India lagging in 5G adoption, the PMO is pushing for an August rollout. Countries such as the US, China, South Korea and the European nations have already launched 5G.
In the consultation paper, Trai’s valuation methods have been highlighted by the operators. This needs to be reviewed as the realities of the market have changed, including the health of industry and its revenue generation ability.
The previous reserve price in 2018 of Rs 492 crore per Mhz for the 3300-3600Mhz band was considered as too steep. The operators needed to pay at least Rs 49,200 crore for the 100MHz required to offer pan-India 5G services.
Spectrum in the 700Mhz band went unsold in the auctions last year even after the regulator reduced the reserve price by as much as 43 er cent compared with its recommendations in 2018.
At the reduced price of Rs 6,568 crore per Mhz, a pan-India block of 5Mhz at the reduced price of Rs 6,568 crore per Mhz costs Rs 32,840 crore.
More than 60 per cent of the spectrum went unsold in 2016 and 2021. The industry expects the reserve prices will be realistic, given the government's commitment toward reforms and the fact that spectrum went unsold in the last two auctions because of the high reserve price.
