Government to auction airwaves worth $11.6 billion to boost phone network

India’s federal cabinet on Thursday approved a plan to sell airwaves in an auction to improve network quality and coverage in the world’s second-largest telecom market. The government will sell airwaves worth ₹963.2 billion ($11.6 billion) at the reserve price, according to a statement from India’s communications ministry. A total of 10,523.1 MHz of airwaves will be available for sale in eight bands – 800, 900, 1800, 2100, 2300, 2500, 3300 MHz and 26 GHz. The government did not give any fixed deadline for the auction.

The airwaves auction, which will include airwaves held by companies going through bankruptcy, will strengthen government finances and help reduce the budget deficit in the South Asian nation. Information and Broadcasting Minister Anurag Thakur told reporters late on Thursday that the additional airwaves will improve the quality of telecom services and expand coverage for consumers.

It will also help major Indian wireless carriers, Reliance Jio Infocomm Ltd, Bharti Airtel Ltd and Vodafone Idea Ltd, to boost services in the country with more than a billion phone users. Local carriers launched 5G services in late 2022, fueling the ongoing data service boom in India.

However, the market is locked in an oligopolistic structure, which limits a carrier’s ability to set prices. No operator can raise its tariffs unless its rivals do so or it risks losing customers.

“Spectrum auctions in India are always bullish,” said Utkarsh Sinha, managing director at boutique investment firm Bexley Advisors.

But the fierce competition most companies are embroiled in is impacting their margins and could impact the capacity and size of their bids for additional airwaves, he said, adding that the pressure on profits could weigh on companies’ ability to bid. And can affect the size.

In the last auction held in 2022, the Indian government raked in $19 billion, with Reliance Jio emerging as the top buyer spending over $11 billion on airwaves.

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(TagstoTranslate)Govt sells spectrum for $11.6 billion, boosts phone network spectrum auction(T)Jio(T)Airtel(T)vi

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