India’s 5G auction delayed again to April-May 2022 – Credibility Gap?
The long delayed auction for the 5G spectrum in India is now likely (???) to take place around April-May 2022, Telecommunications minister Ashwini Vaishnaw said on Thursday. While relief measures announced in September this year for telecom operators marked the first set of reforms, the government will bring out a series of further reforms and “telecom regulatory structure should change in coming 2-3 years”, Vaishnaw said at an event in India.
The Telecom Regulatory Authority of India (Trai) is working on the modalities of the auction. “Our estimate is by April-May. I think it will take time because Trai consultations are complex, diverse opinions are coming,” Vaishnaw said.
[Credibility gap: When he announced the government’s big-bang telecom reforms in September, Vaishnaw had said the auctions would be held in February.]
The telecom department has approached Trai for its recommendations on pricing, amount of 5G spectrum for sale and other modalities.
“The (India) government had budgeted for inflows of nearly Rs 54,000 crore from other communication services for the current year, presumably boosted by the expectation of fresh auction inflows,” according to Aditi Nayar, chief economist, Icra. “We now assess the inflows from the telecom sector into the government’s 2021-22 non tax revenues to be limited to Rs 28,000 crore, trailing the budgeted Rs 54,000 crore, which will modestly widen its fiscal deficit, “ she said.
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The government is targeting a fiscal deficit of 6.8 per cent of GDP in 2021-22, a big improvement over the previous year when the fiscal deficit shot up to 9.3 per cent in the Covid-affected economy. The DoT has sought the views of Trai across multiple bands such as 700Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz, 2300 Mhz, 2500 Mhz bands as also 3,300-3,600 Mhz that were not put up for auctions in the last round.
On the timeline for 5G auctions, Vaishnaw noted that the Trai is undergoing consultations on the matter. “I think they will submit their report by February-mid is what we are thinking, maybe February-end, maximum to maximum March. Immediately after that, we will have the auctions,” he said.
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The Telecom Regulatory Authority of India (TRAI) has reportedly informed the Department of Telecommunications (DoT) that it is likely to submit 5G pricing recommendations in March. If things go as planned, India will hold its repeatedly delayed 5G auction in July-August 2022.
Despite the buzz around 5G, telecom companies, along with private players, are only conducting 5G trials in the country.
Bharti Airtel has successfully conducted India’s first 5G trial in the 700 MHz band in partnership with Nokia, on the outskirts of Kolkata.
Earlier last year, Airtel demonstrated India’s first 5G experience over a live 4G network. It also demonstrated India’s first rural 5G trial as well as the first Cloud gaming experience on 5G.
Reliance Jio is another leading player in the field of 5G testing technology. The company has successfully conducted trials of connected drones on its indigenous 5G network. According to Mukesh Ambani, Chairman and Managing Director, Reliance Industries Limited (RIL), India must complete the migration from 2G to 4G to 5G at the earliest and the rollout of 5G should be India’s national priority.
Jio says it has developed a 100 per cent home-grown and comprehensive 5G solution, which is fully Cloud native and digitally managed.
“Because of its converged, future-proof architecture, Jio’s network could be quickly and seamlessly upgraded from 4G to 5G,” according to Ambani.
Nokia and Vodafone Idea have also partnered to trial 5G services using E-band in areas where fibre is challenging to deploy.
Vodafone Idea is currently conducting 5G trials in India using the trial spectrum in the 3.3GHz-3.6GHz band and mmWave band (24.25GHz-28.5GHz). Earlier, Vodafone Idea had achieved peak speed of over 3.7 Gbps during its 5G trials in Pune.
The DoT had approved applications of Reliance Jio, Bharti Airtel, Vodafone and MTNL for 5G trials.
The 5G technology will represent around 39 per cent of mobile subscriptions in India at the end of 2027, estimated at about 500 million subscriptions, according to an Ericsson report.
https://economictimes.indiatimes.com/industry/telecom/telecom-policy/why-india-must-take-first-step-towards-5g-rollout-this-year/articleshow/88643748.cms
India’s telecom services providers have via the industry body COAI expressed disappointment with TRAI’s recommendations for auction of 5G spectrum bands.
In a strongly worded reaction, COAI called the recommendation a “step backwards” than forward towards building a digitally connected India.
COAI maintained that the spectrum pricing recommended by TRAI was too high, and noted that throughout the consultation process, the industry had presented extensive arguments based on global research and benchmarks, for significant reduction in spectrum prices. “Industry recommended 90% lower price, and to see only about 35-40% reduction recommended in prices, therefore is deeply disappointing,” it said.
It added that charging a 1.5x price for spectrum for a 30-year period will nullify the relief provided by the Union Cabinet in 2021. The industry body pointed out that by introducing mandatory rollout obligations for 5G networks without factoring the huge cost of such a rollout, TRAI has “delinked itself from reality and is running counter to the Government’s efforts of enhancing ease of doing business”.
On allowing private captive networks for enterprises, COAI argued that TRAI was dramatically altering the industry dynamics and hurting the financial health of the industry rather than improving it. Private networks would be a disincentive for the telecom industry to invest in networks and continue paying high levies and taxes, it contended.
Reference:
https://www.thehindu.com/business/Industry/explained-why-are-telecom-companies-upset-with-trai-despite-its-proposal-to-cut-spectrum-prices-by-40/article65326339.ece