India's mega-auction of 5G spectrum for high speed internet services entered its seventh day on Monday, 1 August, after 37 rounds of bidding.
While the first day bids exceeded expectations and surpassed 2015 records at Rs 1.45 lakh crore, the total bid amount only increased marginally to Rs 1.5 lakh crore in the following days.
Reliance Jio and Bharti Airtel lead the auction with bids of over Rs 80,100 crore and Rs 50,000 crore respectively, while Vodafone Idea and Adani Enterprises trail with bids of Rs 15,000 crore and Rs 5,000 crore.
Bidding Fizzles
72 GHz of spectrum was put on auction from 26 July, with a validity of 20 years. The available frequency bands are, 600 MHz, 700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 3,300 MHz and 26 GHz.
Of the 72 GHz, only 51 GHz has been sold in 37 rounds of bidding, leaving about 30 percent of the spectrum unsold, according to PTI.
Most of the spectrum has reportedly been sold on reserve price, which refers to the lowest amount that the government will accept as the winning bid – a base price of sorts.
The 1800MHz band in Uttar Pradesh East circle, which includes Lucknow, Allahabad, Varanasi, Gorakhpur, and Kanpur, is being hotly contested. Aggressive bidding by Jio and Airtel has pushed the price up by about 60 percent.
Meanwhile, Jio is the only participant to pick up spectrum from the 700 MHz band so far, with bids worth Rs 39,000 crore. About 60 percent of the band remains unsold.
The band, which went untouched in the last two spectrum auctions, is the most expensive one on the block even after its price was brought down by 40 percent.
Why Is the 700 MHz Band So Expensive?
When it comes to telecom signals, a lower frequency often translates to a more robust signal. While lower frequencies offer slower internet speeds, they can reach farther and are less affected by buildings and terrain.
For India, the low frequency 700 MHz band is ideal for covering large areas cost effectively. It is five times more efficient than the 1800 MHz band and twice as efficient as 900 MHz, according to Business Standard.
The band reportedly allows a single tower to cover a 100-kilometre radius, compared to mid-bands that offer a coverage of 1-3 kilometres.
The interest in the 700 MHz band by the telecom companies "indicates the communications service providers (CSPs) are focusing on enhanced indoor coverage, where the 700 MHz band could play a crucial role," Pulkit Pandey, Principal Analyst, Gartner, told IANS.
"This band could also help CSPs to provide standalone 5G services and introduce network slicing (customising spectrum for different uses). This could be an indication for CSPs trying to also start working on standalone 5G," Pandey added.
Standalone 5G uses newer components, instead of the existing 4G LTE infrastructure to provide ultra-low latency internet. Only Jio plans to utilise this at the moment.
(With inputs from IANS, PTI and Business Standard)
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