Slash 5G base prices by up to 70% – private telcos tell India

5G base price India
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India’s private telecom operators – Reliance Jio, Bharti Airtel and Vodafone Idea – have again reached out to the country’s Department of Telecommunications (DoT) to reduce base prices of 5G spectrum by up to 70%.

The move comes weeks after the department sent a reference to the Telecom Regulatory Authority of India (TRAI) seeking fresh prices of all current and future 5G bands, including the mid-band (3300-3600 MHz band), mmwave band (26-28 GHz) along with newer bands such as 600 Mhz and 700 Mhz which could be used for 5G in future.

Last week, the telcos’ representative body, the Cellular Operators’ Association of India (COAI), raised the demand in its letter to the DoT secretary K. Rajaraman.

“The telcos via COAI have said unless airwave prices are not dropped by 60-70%, then 5G auctions won’t be successful. The three telcos will participate better if prices are lowered,” said a senior executive of one of the private telcos,” A senior executive working with a leading Indian telco was quoted as saying by the Economic Times.

Indian telcos recently urged the telecom regulator, the Telecom Regulatory Authority of India (TRAI), to look into the availability, quantum and pricing of all possible 5G bands and their base price ahead of the next round of auctions.

India is expected to conduct the 5G spectrum auction in April-May 2022, the Minister for Communication Ashwini Vaishnaw recently said. 

“They [Trai} have already started the consultation process. The process should end somewhere in the February-March time frame in the coming year. Then the auction process will be in Q2 of calendar year 2022,”  Vaishnaw said last week.

However, spectrum prices have remained a contentious issue. Indian telecom operators had skipped bidding for the premium 700 Mhz band spectrum in the last three auctions due to the high price. The 2500 MHz band was also left untouched. 

The regulator had previously recommended that base price at about Rs 492 crore ($67.4 million) per Mhz unpaired spectrum in the band on a pan-India basis. The price has been deemed too expensive by all three private players.

The auction was previously expected in the January-March period, but the unavailability of certain spectrum in the mid-band has resulted in the delay. Additionally, telecom operators had sought an extension to expand the scope of 5G trials, which also made the Indian government push the auction timeline.

Earlier this month, Vodafone Idea’s managing director and chief executive, Ravinder Takkar, informed analysts that there would again be no takers for 5G spectrum if the base prices were not brought down.

India’s antitrust watchdog already said in its report that 5G spectrum in the country is “relatively more expensive” than other countries, and the government needs to ensure that telcos are able to acquire spectrum at affordable rates.

In March this year, the Indian government sold a total quantity of 855.60 MHz of spectrum in 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, and 2300 MHz bands to Indian telcos against a total quantity of 2308.80 MHz spectrum, which was put to auction.

India sold spectrum worth Rs 77,814.80 crore ($10.66 billion) to Reliance Jio, Bharti Airtel and Vodafone Idea March.

India may face another failed auction unless 5G base price is reduced

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