7 Days - 40 rounds later, India’s 5G Spectrum Auction concludes, Govt nets INR 1.50 lakh crore

After 7 days and 40 rounds of bidding, India’s first ever 5G auction concluded on August 1^st, 2022 with the government netting in a record INR 1,50,173 crores.

Spectrum Sold in Auction

Telecom Minister Ashwini Vaishnav told reporters at the conclusion of the 5G auction, “Everybody was expecting it to be in the INR 80,000 to INR 1 lakh crore range. So this is definitely surprising.” The minister added, “with better availability of spectrum, quality of service will be improved. We are in discussions with operators. With policy issues resolved now, telcos should focus on quality of service.”

The 5G auction was held for the following categories of spectrum bands—low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz), mid (3300 MHz), and high (26 GHz). No bids were received by the government for 600 MHz, 800MHz, and 2,300 MHz bands. 

5G is the fifth-generation mobile network capable of transmitting a large set of data at a very rapid speed. In comparison to 3G and 4G, 5G has a very low latency which will enhance user experiences in various sectors. Low latency describes the efficiency to process a very high volume of data messages with a minimal delay.
The 5G rollout is also expected to bring more development in remote data monitoring in sectors such as mining, warehousing, telemedicine, and manufacturing, among others.

In preparation for the 5G auction, Reliance Jio had put in INR 14,000 crore as earnest money deposit (EMD), while Bharti Airtel submitted EMD of INR 5,500 crore. Vodafone Idea Limited had deposited INR 2,200 crore as EMD, and new entrant Adani Data Networks submitted 100 crore as EMD. The EMD amounts indicated the plans of respective telcos of buying spectrum.

A total of 72.098 GHz of airwaves had been put up at the auction, which saw 51.236 GHz or 71% being taken up by the four bidding telcos. At the conclusion of the auction, union telecom minister Ashwini Vaishnav in his address to the media remarked that “the spectrum purchased is good enough to cover all the circles in the country.”

Meeting expectations, the highest purchaser of spectrum was Akash Ambani led, Reliance JIO whose spendings were around INR 88, 078 crores worth of spectrum in all 22 circles, picking 24.740 GHz of airwaves across the 700 MHz, 800 MHz, 1800 MHz, 3300 MHz, and 26 MHz bands.

With this development, Reliance Jio has consolidated its position in the domestic telecom sector. Notably, more than a quarter of bids came for 700 MHz—which has been touted to be the most effective 5G spectrum band. 

The country’s second-largest telco Bharti Airtel came in second with 19.867 GHz of spectrum across 900 MHz, 1800 MHz, 2100 MHz, 3300 MHz, and 26 GHz bands and a total spending of INR. 43084 crores.

Vodafone Idea’s spending amounted to INR 18,799 crores with 6.228 GHz of airwaves picked across 1800 MHz, 2100 MHz, 2500 MHz, 3300 MHz, and 26 GHz bands.

Gautam Adani led, Adani Data Networks bought spectrum in 6 states, spending INR 212 crores for 400 MHz in the 26 GHz bands. Adani Group bought less than one percent of all spectrum sold. The Adanis are planning to use the 5G spectrum to set up a private telecom network. 

All four bidders have the option to make payments in 20 equal installments over the next 20 years. 20 years is also the duration of the right to use spectrum acquired in the auction. The first installment in case the telcos opt for the option would be INR 13,365 crores.

Earlier Telecom Minister, Ashwini Vaishnav had indicated that5G services are likely to be rolled out in the country by October this year.