Government clears auction of 72 GHZ spectrum for 5G rollout

India prepares for 5G rollout

by 5paisa Research Team Last Updated: 2022-06-16T18:38:00+05:30

In an extremely significant move, the government has decided to auction a total of 72097.85 MHz of spectrum by July 2022 and it will have a validity periods of 20 years. This is an important step as India prepares for the launch of 5G or Fifth Generation voice and data services. The 5G is a lot more compatible and supportive of newer usages like high streaming videos, application of artificial intelligence, machine learning etc.

The sale of the mm Wave spectrum has been approved by the Union Cabinet for all telcos. To make the process smoother, the government has assured that it will not charge spectrum usage charge (SUC) for the spectrum acquired via this auction. More importantly, the successful bidders also don’t have to pay upfront amounts for this particular spectrum. The 5G spectrum auction was approved by a special committee chaired by the Prime Minister.

Key features of the 5G spectrum auction,

Here are some of the key features of the spectrum auction proposed by the government in the 5G realm.

    • The total auction will be for 72097.85 MHz (approx. 72 GH) of spectrum and such spectrum will have a validity period of up to 20 years. The auction will be in July 2022. 

    • The spectrum is available in 3 categories viz. Low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), Mid (3300 MHz) and High (26 GHz) band.

    • The auction will only entail the payment of the one-time spectrum fee to the government, as outlined in the Telecom Relief Package.

    • In other words, the bidders will be exempt from spectrum usage charge (SUC) in the 5G spectrum auction. The mandatory upfront payment also stands removed.

    • In terms of the structure of the payments, the bidders can make payments in 20 annual instalments made in advance at the start of each year.

    • There is an additional facility wherein the bidders are allowed to surrender the spectrum after 10 years with no future liabilities.
More spectrum on offer
Several factors indicate that the government is making a lot more of spectrum available to the telecom companies with a view to pushing 5G in India. Here is a sampler.
    • The Cabinet will double the number of traditional microwave backhaul carriers in the existing frequency bands of 13, 15, 18 and 21 GHz bands.

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    • Approval will be granted by the government to set up private networks for captive use to encourage the creation of high end ecosystems like smart factories, Industrial Internet of Things (IIOT), Machine to Machine communication (M2M) etc.

    • The highly coveted mm-Wave spectrum has also been made available in the 5G spectrum auction in the aftermath of the SATCOM companies lobbying hard with the government for the same. Mm-Wave is the most lucrative for 5G spectrum bands.
The action now shifts to the government which will conduct the auctions in July 2022 and will be the first big step to create an ecosystem for leveraging the use of 5G spectrum in the Indian context. 

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