5G Technology

India’s spectrum auction turns out to be a damp squib – Light Reading

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India’s recently concluded spectrum auction was a damp squib, with the government getting just INR113 billion (US$1.35 billion), or around 12% of the total base price of 962.38 billion Indian rupees ($11.5 billion). The auction concluded early on the second day. 

Surprisingly, Reliance Jio, which had submitted the highest earnest money deposit (EMD) of INR30 billion ($359 million), acquired only 14.4 Mhz of spectrum in the 1,800MHz frequency band in just two circles (service areas) of Bihar and West Bengal. It spent a total of INR9.7 billion ($116.6 million).

“This new spectrum acquisition will continue to enable us in serving aspirations of the new India, in terms of growing traffic demands and superior customer experience, which is no longer limited to only urban markets,” said Akash M. Ambani, chairman of Reliance Jio Infocomm.

Airtel, on the other hand, acquired 97 Mhz in the 900Mhz, 1,800MHz, and 2,100MHz bands for a twenty-year period for INR68.6 billion ($821 million). The company not only renewed its expiring spectrum but also purchased additional frequencies to strengthen its mid-band holdings.

“The spectrum purchase is in line with company’s stated strategy to build large pool of mid-band holding to deliver seamless 4G and 5G services across the country,” says a press release issued by Airtel.

“Airtel continues to judiciously acquire the right amount of spectrum to deliver the best possible experience to our customers. In this auction, we have bolstered our sub-giga hertz and mid-band holding which will significantly improve our coverage especially indoor,” said Gopal Vittal, managing director and chief executive officer at Bharti Airtel.

India’s third-largest service provider, Vodafone Idea, acquired 50 MHz of low-band and mid-band spectrum in the 900MHz, 1,800MHz, and 2,500MHz frequency bands. It acquired spectrum in 11 circles for INR35.1 billion ($420.66 million).

Like Airtel, Vodafone Idea had to renew 900MHz spectrum in two circles of Uttar Pradesh West and West Bengal. Apart from this, it has acquired 900MHz spectrum in Andhra Pradesh, Tamil Nadu, Karnataka, Punjab, Rajasthan, Uttar Pradesh East and Kolkata, which it believes will boost the indoor experience of its 4G subscribers. It has also acquired 1,800MHz spectrum in Madhya Pradesh and 2,500MHz spectrum in Bihar.

“This acquisition will enable us to effectively use dedicated sub-GHz spectrum towards advanced technologies to enhance the experience we offer to our customers. As VIL embarks on its growth journey with the fund-raising plan in place, this spectrum acquisition will further strengthen its competitive position in the market,” says Akshaya Moondra, CEO of Vodafone Idea.

India held its last spectrum auction in 2022, in which the government raised INR1.5 trillion ($17.97 billion). Telcos used this spectrum to launch 5G services in 2022. However, they have yet to start monetizing their investment in spectrum and 5G network deployment. Besides, Airtel and Reliance together have 172 million 5G subscribers, which means they have enough capacity and don’t really need to invest more in spectrum acquisition.

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