Reliance Jio and Bharti Airtel to bid for 5G spectrum nationwide, uncertainty on VIL bid

Top telecoms including Reliance Jio and Bharti Airtel most likely to buy 5G spectrum across the country, rather than just in urban or tier 1 locations during the upcoming auctions, owing to competition challenges and to profit from scale advantages for equipment and phones, according to a market survey by BoFA securities.

According to the BofA study, any telecom provider that did not bid for 5G spectrum in a certain circle will find it impossible to carry out 5G on existing 4G bands since the existing networks are fully utilized. As a result, the extent of the 5G spectrum that could be framed is limited.

The report stated: "Higher reserve price is likely to disincentive any new telcos to bid in the auction and only telcos with strong balance sheets like RIL, Bharti are in a position to buy pan India 5G Spectrum. It remains unclear how VIL would fund its 5G bids.”

According to the research conducted by BofA analysts, VIL management has focused on top core circles. Additionally, the corporation may bid selectively in its core 3G and 4G circles. As mentioned in the report, VIL could opt for post-5G due to the requisite network architecture, which they currently lack.

It is estimated that operators may be interested in 3.5 GHz in this auction, according to the report, because it is the major band for 5G, while the premium 700 MHz band may draw little attention due to its higher cost and also because propagation characteristics are nearly equal to those of the 800 and 900 MHz bands.

The Central government is expected to hold the auctions for the spectrum by the end of June or early July.Within 3 to 6 months of receiving spectrum, telcos are expected to roll out 5G in urban and semi-urban areas. The best vendors in India are well positioned to assist in expediting delivery. 5G services are expected to be available by August-September this year.