5G Spectrum Auction Starts Today. Know Companies In Fray, Radiowaves On Offer & Key Details

The telecom department is aiming to fetch Rs 70,000 crore to Rs 1,00,000 crore from the 5G auctions that would trigger new-age offerings and business models, and enable ultra-high speeds

The battle for India’s fifth-generation airwaves will kick-start on Tuesday, with four major players, including some of the country’s richest tycoons, bidding for the 72 GHz of radiowaves worth Rs 4.3 lakh crore offer. The 5G bidding process that will decide who dominates the digital era is scheduled to start from 10 am and go on till 6 pm, reported news agency PTI.

Know everything about the 5G spectrum auction

The duration of the auction will depend on the actual demand for radiowaves and strategy of individual bidders, sources in the Department of Telecom said, as per the PTI report.

Going by the reserve prices for various bands, 72 GHz of radiowaves would be worth Rs 4.3 lakh crore.

The department is aiming to fetch Rs 70,000 crore to Rs 1,00,000 crore from the 5G auctions that would lead to new-age offerings and business models, and enable ultra-high speeds – almost 10 times faster than 4G.

The companies in fray include Reliance Jio, Bharti Airtel, Vodafone Idea and a unit of billionaire Gautam Adani’s flagship Adani Enterprises. The spectrum is expected to be sold near the reserve prices, and the bidding may last for two days, believe experts.

The auction will be held for spectrum in various low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz) and high (26 GHz) frequency bands.

“The bidding will be done for 5G networks, reducing SUC (Spectrum Usage Charges) rates and enhancing existing spectrum bands, resulting in demand mainly led by 3.3 GHz/26GHz spectrum bands,” brokerage firm Jefferies said in a note last week.

It is expected that Jio will lead the spends, followed by Bharti Airtel. While analysts predict limited participation from Vodafone Idea and Adani Group.

Market watchers do not expect an intense or aggressive bidding looking at the abundance of spectrum and four companies in the race.

Reiance Jio makes aggressive moves

Mukesh Ambani’s Reliance Jio has made a Rs 14,000 crore Earnest Money Deposit (EMD) while rival Adani group made a modest Rs 100 crore deposit recently. The EMD is seen as the reflective of the quantity of airwaves a company can bid for in the auction. Jio’s deposit is the highest among the four players in the race, according to the information released by the department on July 18 as part of the list of pre-qualified bidders.

Jio's EMD suggest that the nation’s largest telecom company by subscribers is eyeing for an aggressive bidding in the upcoming auctions while Adani Group may try to procure the bare minimum spectrum needed to set up a private network.

The EMD amount of Adani Data Networks is at Rs 100 crore, which indicated a muted and limited spectrum demand from its side. Sunil Mittal-led Bharti Airtel had put in Rs 5,500 crore as EMD while for Vodafone Idea the amount stands at Rs 2,200 crore.

Typically, EMD is an indication of the players’ appetite, strategy and plan for picking up spectrum in an auction. The figure also determines the eligibility points, through which telcos target specific amounts of spectrum in various circles.

EMD of all the four applicants seeking 5G radiowaves this time adds up to Rs 21,800 crore, a level substantially higher than Rs 13,475 crore deposited in the 2021 auction when three players were in the race.