India looks to delay 5G spectrum auction into next year

India looks to delay 5G spectrum auction into next year

India’s next spectrum auction – originally scheduled for this year – looks set to be delayed into early 2020 as the Department of Telecommunications (DoT) has not yet finalised some major details.

According to The Economic Times (ET), the DoT has thus far not confirmed the amount of spectrum that will be made available for bidding, decided on the reserve prices for the various bands, or finalised the terms and conditions for participants.

The auction could be the largest ever held in India, with the government proposing the sale of up to 3000MHz of spectrum in eight different bands, including two 5G-ready bands. It will be India’s first since October 2016, and the DoT had planned to hold it prior to the end of the year. However, a DoT spokesperson told the ET that “the timeline may be delayed by around a month”, pushing the auction into 2020.

In December 2018, the DoT confirmed that it would not hold further spectrum auctions until the latter half of 2019 – partly in response to requests from India’s tightly-squeezed operators. Vodafone Idea has called for the DoT to delay the auction into 2020 on the grounds that the country’s 5G ecosystem needed to mature in order to drive demand for the spectrum. Executives at Bharti Airtel said that the operator would not participate in a premature 5G auction as the business cases were not evident – in part due to the scarcity of affordable 5G devices.

A fierce price war that was spurred by the 2016 market entry of Reliance Jio has led to spiralling ARPU and escalating debt. Earlier this month, the Confederation of Indian Industry cautioned that high reserve prices for 5G spectrum would exacerbate these issues and stunt market growth.

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