Incoming broadband mobile internet, as Cabinet approves 5G spectrum auction
The spectrum auction will begin on July 26, 2022.
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TRAI had previously recommended a reduction of around 39% in the reserve price or floor price for the sale of 5G spectrum for mobile services.
While 5G spectrum in nine frequency bands will be auctioned off to telecom operators like Bharti Airtel and Reliance Jio, the Notice of Invitation to Bid – bid-related document issued by the DoT – said the Large tech companies will be allowed to take 5G Spectrum for their non-public captive network for the time being, on lease from telecommunications companies.
The notice of invitation to tender indicates that the direct allocation to large technology companies will follow a study of demand and the recommendation of the sector regulator TRAI on aspects such as pricing and the terms of such allocation.
Big tech companies like Google have sought to directly allocate spectrum for applications such as machine-to-machine communications, IoT and AI, while telecom companies have opposed the direct allocation of 5G spectrum saying it would distort the level playing field and rob the government of revenue.
According to the document, the auction should start on July 26, 2022. Other key dates to watch include the pre-bid conference scheduled for June 20, 2022, the submission of applications with a deadline set for July 8, and the pre-qualification of bidders on July 18. Auction simulations will take place on July 22. and 23, 2022.
A total of 72097.85 MHz of spectrum with a validity period of 20 years will be auctioned to be held by the end of July 2022.
The auction will take place for spectrum in various Low (600MHz, 700MHz, 800MHz, 900MHz, 1800MHz, 2100MHz, 2300MHz), Medium (3300MHz) and high (26GHz) Frequency bands.
Overall, payment terms have been eased for bidders in the upcoming auction.
Continuing the pace of telecommunications sector reforms, the Cabinet announced various phased options for spectrum auctioning, to facilitate the conduct of business.
“For the first time ever, there is no mandatory upfront payment requirement by successful bidders. Spectrum payments can be made in 20 equal annual installments to be paid in advance at the start of each year,” said he stated, adding this. should significantly alleviate cash requirements and reduce the cost of doing business in this sector.
Bidders would have the option to return the spectrum after 10 years without any future obligation with respect to balance payments. No SUC (Spectrum Utilization Fee) will be charged for spectrum acquired in this auction.
“The availability of sufficient backhaul spectrum is also necessary to enable the deployment of 5G services. To meet the link demand, the Cabinet has decided to provisionally allocate 2 carriers of 250 MHz each in E-band to telecommunications service providers,” the official statement reads.
The Cabinet has also decided to double the number of traditional microwave backhaul carriers in the existing frequency bands of the 13, 15, 18 and 21 GHz bands, the statement said.
The Indian market is primed for 5G services, which will usher in ultra-high speeds and spawn new-era services and business models, and mega-auctions will pave the way for telecom operators to roll out next-generation services in 2022- 23.