- 16 Jun 2022
- ICICIdirect Research
5G Auctions to begin from July 26th, 2022
News: The Union Cabinet approved the Department of Telecom’s proposal for the auction of 5G spectrum for a 20-year period. The department of telecom has notified that the auction of 5G airwaves will begin on 26th July, 2022. Cabinet has left the reserve price of 5G airwaves unchanged. On the payments front, payments for spectrum can be made in 20 equal annual instalments, which will be paid in advance at the beginning of each year vs. mandatory 25%/50% upfront payments, required for specific spectrum, earlier. Furthermore, there will be no spectrum usage charges for the spectrum acquired in this auction, as intimated earlier. On the private networks front, all the four methods of allocating spectrum for private 5G networks as recommended by TRAI, including the option of enterprises obtaining spectrum directly from the DoT, have been permitted.
Views: We expect 5G spectrum value for an operator to be ~Rs 37000-38000 crore assuming 100 Mhz for core 3.5 Ghz band (Rs 31700 crore) and some millimeter band spectrum. On positive front, easing of payment terms is provides cash flow staggering options. Private network allocation is a bit of setback, albeit DOT would undertake demand study before allocating direct spectrum for private network.