Interest in pricey 700MHz band means enhanced 5G indoor coverage for Indians
As India saw a record 5G spectrum auction for 72 GHz (gigahertz) of airwaves at Rs 4.3 lakh crore on day one, analysts said on Wednesday that one of the surprising turns was the attention gained by the 700MHz band, which was left unsold in the last auctions.
New Delhi, July 27 As India saw a record 5G spectrum auction for 72 GHz (gigahertz) of airwaves at Rs 4.3 lakh crore on day one, analysts said on Wednesday that one of the surprising turns was the attention gained by the 700MHz band, which was left unsold in the last auctions.
The costliest 700 MHz band is ideal for coverage in high-density areas and deep data networks.
According to analysts, this band received bids worth nearly Rs 39,000 crore led by Reliance Jio.
Pulkit Pandey, Principal Analyst, Gartner, told IANS that 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".
"This band could also help CSPs to provide standalone 5G services and introduce network slicing. This could be an indication for CSPs trying to also start working on standalone 5G," Pandey added.
On the first day of the auction, the 3300 MHz and 26 GHz bands attracted strong bids by the four key players -- Reliance Jio, Bharti Airtel, Vodafone-Idea and an Adani group firm.
As per IT Minister Ashwini Vaishnaw, there were four rounds of bidding on the first day with most interest in mid and high-end bands and strong interest in the 3300 MHz and 26 GHz bands. Bids were also received for the 700 MHz band, he said.
According to industry experts, the maximum bids have come from Reliance Jio that could be over Rs 80,000 crore.
According to Pandey, the 5G auction in India is not expected to witness a very aggressive bidding approach from any CSPs.
"Reliance Jio, with its highest EMD, is expected to put a strong focus on their existing spectrum bands, which includes the 800 MHz and 1800 MHz. Apart from these bands, they should be focusing a lot on the mid band (C Band)," he noted.
Another thing to note is how these CSPs would be positioning themselves on the mmWave (26 GHz) band because that is expected to be used for enterprise applications, giving the CSPs an edge over the Captive Networks, the auction for which is yet to be planned.
Devroop Dhar, Co-Founder and Board Member, Primus Partners, said that with estimations of 500 million 5G subscribers by 2027 and the internet carrying 56 per cent of India's traffic, Reliance Jio has been the frontrunner of the 5G spectrum race in India followed by Bharti Airtel, Vodafone Idea and Adani Data Networks.
"With only about 30 per cent of the towers fiberised and less than 7 per cent of households connected through fibre, companies must not simply focus on the spectrum but also give the same importance to the subsequent infrastructure," Dhar said.
As opposed to company business modules, the rollout must be staggered as 5G requires significant infrastructure from telcos and in many cases upgrade of handsets by users. A
"A single window clearance or grant of permission for fiber-laying should be considered," said Dhar.
The first-day bids "exceeded all expectations and surpassed 2015 records", according to the IT Minister.
Vaishnaw also said that the government will allocate the spectrum in record time, in accordance with the August 14 deadline, and 5G services are expected to start rolling out by September.
The auction entails the 600, 700, 800, 900, 1800, 2100, 2300, 2500, 3300 MHz and 26GHz bands.
The four big players in the race had submitted a combined Rs 21,400 crore in earnest money deposit (EMD), and are ready with their war chests and strategies for the mega bid, that is likely to be around Rs 1.5 lakh crore if the last two auctions are kept in mind.
Reliance Jio Infocomm has submitted an EMD of Rs 14,000 while Bharti Airtel has put in Rs 5,500 crore.
In the 2021 auctions for 4G spectrum, Reliance Jio used 77.9 per cent of their earnest money deposit while Airtel used 87.7 per cent.
The 5G era will open 10 times faster than 4G and 30 times faster than 3G, allowing millions to have an experience never seen before.