5G Spectrum Auction Wraps Up: Who win the race.
India’s largest ever spectrum auction was hailed as a complete success. On Monday, after completing 40 rounds of provisional sale of airways, the centre not only received ₹1.5 lakh crore but also made it possible for telecom companies to acquire 5G spectrum by placing bids significantly beyond the reserve pricing.
The auction is aimed at preparing the ground for the widespread implementation of 5G services in India, the second largest mobile market in the world.
Reliance Jio has emerged as the most aggressive bidder, acquiring 24,740 MHz of 5G spectrum for ₹88,078 crores (nearly $11 billion) and was the sole applicant (out of four) to have obtained the spectrum in the exclusive 700 MHz band.
How Much Spectrum Was Bought by the Applicants?
Out of the total 72 GHz that was up for grabs in the market, 51.2 GHz of the spectrum was sold, i.e., over 71%. The estimated total first annual instalment received by the government from the bidders is ₹13,365 crore. The final total bids, which were estimated by the government to be around ₹1 lakh crore, came in at ₹1,50,173 crore, exceeding estimates.
What Is the Reason Behind the Auction Fetching More Cash Than Estimated?
In the telecom auctions held in 2016 and 2021, the 700 MHz bands remained unsold. But this year, it turned into a sought-after asset for carriers. Since the band was not being purchased in the last two auctions due to its high price, the government anticipated it to be unsold again this year.
The 700 MHz offers improved indoor penetration in metropolitan areas with dense populations and is ideal for data networks and consumer-led services. It can provide a range of 6-10 km. With bids totalling ₹39,270 crores, it received the second-highest amount.
The 3,300 MHz bands received the most bids, of ₹80,590 crores. The third-highest bid, at ₹14,709 crores, was for the 26 GHz mm band, which is suitable for enterprise-level 5G applications, such as establishing private 5G networks.
The bidders purchased airwaves in the 800 MHz–2500 GHz frequency bands largely to expand their 4G coverage and close gaps in areas where the 4G network had started to get overloaded. While the 600 MHz seems no taker in the current auction.
⭐How Did Jio, $BHARTIARTL, $IDEA and Adani Group Bid? ⭐
▪️ Reliance Jio spent ₹88,078 crores and purchased a total of 24.7 GHz of spectrum in the 700 MHz, 800 MHz, 1800 MHz, 3300 MHz and 26 GHz bands. At the same time, Jio was the only bidder to have the highly sought-after 700 MHz band. Additionally, the company has acquired a 10 MHz band in each of the 22 circles.
▪️ Airtel spent ₹43,084 crores to acquire a total of 19.8 GHz of spectrum in the 900 MHz, 1800 MHz, 2100 MHz, 3300 MHz, and 26 GHz bands.
▪️ Vodafone Idea spent ₹ 18,799 crores to acquire a total of 6,228 MHz of airwaves in the 1800 MHz, 2100 MHz, 2500 MHz, 3300 MHz, and 26 GHz bands.
▪️ Adani Data Networks spent 212 crores to acquire spectrum in the 26 GHz to offer solutions for private networks in industries including logistics, power generation, and ports. The company had earlier made it clear currently it will not enter the consumer mobility space.
♂️ How Competitive Was the Bidding?
While all other frequency bands were sold at base price, only the 1800 MHz airwaves saw the reserve price exceeded during the auction. The Uttar Pradesh (East) circle, which has over 100 million cellular connections and is the nation’s largest mobile telephony circle in terms of customers, led the competition in the 1,800 MHz spectrum.
It is expected the government will allocate the spectrum to bidders by August 10 and by October, 5G services should be available throughout the nation