5G Spectrum Auction Might Get Delayed to 2023

India might further delay the much-awaited 5G spectrum auction till the end of FY23, sources report.

5G Spectrum Auction Moved Back a Year, Possibly

The telecom minister, Ashwini Vaishnaw, while announcing the telecom relief package and reforms, had said that the government will create an auction calendar to facilitate spectrum sales. However, it seems like, in contrast to Vaishnaw's comments, the government might look to delay the 5G tender by at least another year.

An official quoted by Business Standard said, "according to the new calendar for spectrum auctions, we are targeting 5G tender around January-March 2023. The person added that according to the DoT's internal consultations, the government will conduct the 5G spectrum auction in the last quarter of FY23.

The same report had added that the lengthy process of conducting a spectrum sale has likely caused the delay. Notably, these steps include internal consultations, TRAI's recommendations and so on. So far, the government had only decided upon the mid-band spectrum for 5G.

After TRAI has completed making the recommendations, it will send them to the DCC, for further refinement. The Digital Communications Commission remains the top decision-making body in the telecom sector. Then, the proposal will go to the Cabinet, and finally, DoT will invite applications for the 5G spectrum.

The official said that the 5G spectrum auction will follow the "due process". They added that since each step will take time, everything can't be done in a "couple of months". He further said, " 5G trials are underway, and we have to evaluate the results of those trials".

No Clarity on Spectrum

So far, the government has only "earmarked" the mid-band 3.3-3.6 GHz for sale. While it is a good band, it is only one band, and that is the issue here.  Moreover, the telcos have been demanding "optimum availability" of spectrum for a successful 5G deployment.

Next, the floor pricing still remains a highly contested aspect of this sale. TRAI has set a base price of Rs. 492 crore/MHz. The telcos have already made it clear that they will not buy the spectrum at that price point. Speaking at the recent Voice&Data 5G Conference, Akhil Gupta, Vice Chairman, Bharti Airtel, called on the government to provide at least 100 MHz of spectrum, and that the floor price of the spectrum be at a low level.

"The ball is in the government's court now; if 5G is to be a mass market phenomenon, the government needs to look at the quantity and the pricing of spectrum," he added.

Last week, the new TRAI secretary V Raghunandan, said that the sector regular was open to reevaluate the floor pricing. He added that the regulator will do so once DoT sends references for all the 5G bands to be put on sale.

The telcos have been demanding at least 400 MHz of the mmWave band - 26-28 GHz - per operator. For now, though, this band has become another headache for DoT, as the satcom players have repeatedly asked for reserving the band for them.

Given the amount of work left to do for the government before the spectrum, it will come as little surprise if it pushes the sale back. However, only time will tell whether that would be a wise call or not.