Spectrum battle for private networks deepens, 5G auction could be delayed, Telecom News, ET Telecom

The 5G spectrum auction could be delayed as the battle over spectrum for private networks has returned to the fore.

The Digital Communications Commission, the apex body of the Department of Telecommunications, has decided not to award 5G spectrum directly to private companies. However, this has ruffled many feathers, which may delay the whole auction process.

Tech firms have made representations to the government through their industry bodies, saying the move could harm the process of digitalizing the economy and the prospect of making Indian products competitive in the global market.

Broadband India Forum, an industry group of tech companies like Apple, Facebook, Google, Microsoft and others, has urged the government to provide spectrum to private networks through an administered allocation at nominal rates, or give it away for free.

Tata Consultancy Services (TCS), India’s largest information technology firm, wants the government to allocate 5G spectrum directly to private companies, as recommended by the regulator. He has ruled out participating in the upcoming 5G auction because rollout obligations make buying airwaves directly financially unviable.

Telecom operators, including Reliance Jio and Bharti Airtel, prefer spectrum to be auctioned off to licensed entities. The telecommunications operators’ view was supported by the Department of Telecommunications (DoT) and the matter will now be decided by Cabinet.

Infosys, India’s second-largest software developer, plans to lease 5G spectrum in key markets to deploy private networks for large enterprise customers, virtually ruling out buying radio waves directly in a sale. Rivals such as Wipro and Tech Mahindra have said they are also looking for carrier and enterprise partners as tech companies look to participate in next-generation technology. HCL Technologies added that it sees huge opportunities for industries taking advantage of next-generation technology.

Ahead of the 5G auction, Ravinder Takkar, managing director and CEO of Vodafone Idea, said the telecoms department should consider “allocating” spectrum that remains unsold to mobile operators at a certain market-discovered price as companies resize the networks to meet the growing digital consumption of the country.

The company is looking to close in on fresh funding estimated at Rs 20,000 crore very soon.

The only hurdle before securing the external financing – to be split equally between debt and equity – is the expectation that the government will deliver on its promise to take a stake in the venture by converting its demand for interest of Rs 16 000 crore in nearly 33% equity.

State-run BSNL urged the government to allocate 10 Mhz of spectrum in the 700 Mhz band.

This mid-band is expected to play a key role in rolling out 5G services in the country.

The 700 Mhz band is considered premium because it offers wide coverage of mobile signals and the fewest telecommunications towers are needed to set up a network in this band compared to other frequencies currently allocated to the sector. If the government sets aside 70Mhz of spectrum in the midband, a total of 300Mhz of spectrum will be left for players to bid on at the next auction.

Good news for the telecom industry, the revenues of the big 3 telecom operators – Reliance Jio, Bharti Airtel and Vodafone Idea – could increase by 20-25% in the financial year 2023, following recent price hikes, according to a report by Crisil.

In fiscal 2023, ARPU (average revenue per user) is expected to increase 15-20% due to the full-year impact of price increases in fiscal 2022 and 2023. Telcos are also expected to spend incrementally on networks and regulatory investments in fiscal 2023. , which could impact ARPU growth, and price increases could ease some pressures.

The industry was in a downturn from fiscal year 2016 due to the appearance of competition from Reliance Jio. However, since the start of the repair phase of the industry, revenues have started to increase.

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