The Confederation of Indian Industry (CII) has cautioned that growth could be stifled in the mobile sector if 5G spectrum reserve prices are set too high for the country’s operators.
With operators seeing ARPU plummet as price wars rage, the industry body has recommended lowering the current base price for the 5G spectrum due for auction this year. If the government does not follow suit, the CII warns that uptake of the new technology will be sluggish.
The Economic Times quoted the CII’s statement as saying: “India’s telecommunication sector has achieved global recognition for the speed of its growth and has the lowest tariffs in the world…High reserve prices of spectrum will halt this accelerated growth and deter uptake of telecom services by poorer sections of society.”
In May, GSMA Intelligence found that the most affordable data rate in the world was available in India, at INR18.50 ($0.26) per GB. The appetite for data in India is vast, with the subscribers using almost 1.5 billion GB of data every month. Research by App Annie found that the country was the number two globally for app downloads.
The body argued that pricing the spectrum based on a ‘dollars per megahertz’ metric was “inappropriate” in a market with a vast population but rock bottom data rates, and called for the government to consider a different metric such as dollar/MHz/GDP or dollar/MHz/revenue as a better way of gauging the price across markets.