5G Spectrum Auction 2024: Key Highlights and Insights.

The 2024 5G spectrum auction in India concluded with bids totaling around Rs 11,000 crore, showcasing a strong commitment from major telecom players to expand their 5G capabilities.

Major Highlights:

• Total Bids: Over Rs 11,000 crore was placed in the auction, which spanned five rounds and resumed on June 26.

• Leading Bidders: Bharti Airtel emerged as the highest bidder, acquiring 97 MHz spectrum for Rs 6,857 crore. Reliance Jio and Vodafone Idea also participated actively.

• Spectrum Details: The government auctioned 10,522 MHz of spectrum across eight frequency bands, including 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300 MHz, and 26 GHz.

• Focus Bands: The 900 MHz and 1800 MHz bands saw the highest bidding activity, with Rs 7,004 crore and Rs 3,614 crore respectively.

• Earnest Money Deposits: Reliance Jio deposited Rs 3,000 crore, Bharti Airtel Rs 1,050 crore, and Vodafone Idea Rs 300 crore, enabling them to bid for a significant portion of the spectrum. Strategic Moves and Future Implications:

• Bharti Airtel's Strategy: Bharti Airtel focused on renewing and enhancing its spectrum holdings, especially in the sub-1GHz and mid-bands, to maintain and expand its network coverage.

• Reliance Jio's Focus: Jio concentrated on bolstering its holdings in the 800 MHz band, essential for providing high-speed internet services.

• Vodafone Idea's Approach: Vodafone Idea primarily focused on renewing its existing spectrum, ensuring continued service quality. Industry Insights:

• Impact on 5G Rollout: The auction is expected to accelerate the deployment of 5G services across India, enhancing coverage and connectivity. According to COAI, this will play a crucial role in achieving digital inclusion.

• Economic Implications: The government will receive Rs 11,340 crore from the auction proceeds within ten days, contributing significantly to the national exchequer. Expert Opinions:

• COAI's View: "The 5G auctions will catalyse the rapid rollout of 5G services across the country, leading to enhanced coverage and vastly improved connectivity," said SP Kochhar, Director-General of COAI.

• Telecom Analyst Perspective: Prashant Singhal noted the limited incremental revenue from 5G globally, suggesting that the major revenue streams will come from enterprise applications and IoT.

Future Projections:

• Subscriber Growth: According to Ericsson's Mobility Report, 5G subscriptions in India are projected to reach around 840 million by 2029, accounting for 65% of mobile subscriptions.

• Government Revenue: The spectrum bought in this auction will be valid for 20 years, with options for telcos to share, trade, lease, and surrender the spectrum after 10 years. Conclusion: The 2024 5G spectrum auction marks a significant milestone in India's telecom industry, with major players positioning themselves to lead in the 5G era. The strategic investments and aggressive bidding reflect the industry's commitment to enhancing connectivity and driving digital growth across the country.
  

Sources:

IANS

Economic Times

Livemint

CNBCTV18

Department of Telecommunications (DoT) Reports

Author: Kaustav Mitra, MBA(Finance)