India's 5G Spectrum Auction: Pricing, Timeline And More

The Cabinet has accepted TRAI's recommendations on pricing for the 5G spectrum auction. Here'a look at the details.

<div class="paragraphs"><p>Telecom towers. (Photo:&nbsp;David Arrowsmith/Unsplash)</p></div>
Telecom towers. (Photo: David Arrowsmith/Unsplash)

India has invited applications for the 5G spectrum auction that will be conducted by July-end. It went with the telecom regulator's suggestions for the key 3,300- and 700-megahertz frequency bands.

The 600 and 700 megahertz bands have the highest reserve price, according to a government notice inviting applications. The pricing is the highest for Delhi and Mumbai across bands.

A total of 72,097.85 MHz of spectrum with a validity period of 20 years will be put to auction by the end of July, according to a government statement. The auction will be held for spectrum in various low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz) and high (26 GHz) frequency bands.

Pricing per block for a single circle is as follows:

600 MHz

  • Range: Rs 75 crore to Rs 2,545 crore

  • Delhi: Rs 2,545 crore

  • Mumbai: Rs 2,350 crore

700 MHz

  • Range: Rs 75 crore to Rs 2,545 crore

  • Delhi: Rs 2,545 crore

  • Mumbai: Rs 2,350 crore

800 MHz

  • Range: Rs 16.25 crore to Rs 598.75 crore

  • Delhi: Rs 598.75 crore

  • Mumbai: Rs 585 crore

900 MHz

  • Range Rs 2.8 crore to Rs 87.2 crore

  • Delhi: Rs 87.2 crore

  • Gujarat: Rs 79.8 crore

1800 MHz

  • Range: Rs 1.6 crore to Rs 54 crore

  • Delhi: Rs 54 crore

  • Mumbai: Rs 47.2 crore

2100 MHz

  • Range: Rs 25 crore to Rs 1,120 crore

  • Delhi: Rs 1,120 crore

  • Mumbai: Rs 980 crore

2300 MHz

  • Range: Rs 320 crore to Rs 1,040 crore

  • Delhi: Rs 1,040 crore

  • Mumbai: Rs 1,030 crore

2500 MHz

  • Range: Rs 20 crore to Rs 860 crore

  • Delhi: Rs 860 crore

  • Mumbai: Rs 810 crore

3300 MHz

  • Range: Rs 10 crore to Rs 400 crore

  • Delhi: Rs 400 crore

  • Mumbai: Rs 350 crore

The Telecom Regulatory Authority of India had in April recommended about a 39% reduction in the reserve or floor price for the sale of 5G spectrum for mobile services.

The reserve price is the same that the regulator had suggested: at Rs 317 crore per MHz for all-India airwaves in the 3300 MHz band, and Rs 3,927 crore per MHz in the 700 MHz band.

To lower the financial burden for the telecom companies, the government has relaxed payment schedule for the bidders.

"For the first time ever, there is no mandatory requirement to make upfront payment by the successful bidders. Payments for spectrum can be made in 20-equal annual instalments to be paid in advance at beginning of each year," a government statement said, adding that this is expected to significantly ease cash flow requirements and lower the cost of doing business in this sector.

The bidders would be given an option to surrender the spectrum after 10 years with no future liabilities with respect to balance instalments.

"The availability of sufficient backhaul spectrum is also necessary to enable the roll-out of 5G services. To meet the backhaul demand, the Cabinet has decided to provisionally allot two carriers of 250 MHz each in E-band to the telecom service providers," it said.

The telecom service providers will alone continue to offer services to enterprises to set up captive networks for now. But enterprises may seek spectrum from the Department of Telecommunications, the government said in the notice seeking applications. For this, the DoT will conduct demand studies and then seek recommendations from the telecom regulator.

The cabinet also decided to double the number of traditional microwave backhaul carriers in the existing frequency bands of 1300, 1500, 1800 and 2100 MHz bands, the release said.

(With inputs from PTI)