India’s government accelerated plans to hold a 4G auction this year to raise much-needed funds as major operators lobbied for a quick sale as they experience a jump in network traffic amid the country’s strict lockdown measures, The Economic Times (ET) reported.
Reliance Jio and Bharti Airtel advised the Department of Telecom (DoT) they require additional spectrum “as soon as possible”, the newspaper said.
The planned auction, covering up to seven bands, is forecast to generate as much as INR4 trillion ($53 billion) for the government, which is facing a surge in spending due to the Covid-19 (coronavirus) outbreak, ET wrote.
The auction date can be set once a draft proposal from DoT is approved by the Cabinet.
While as much as 2,475MHz of 4G spectrum is forecast to go on sale, much of it won’t be sold as the debt-laden operators will likely be selective as they look to boost capacity in specific areas. Vodafone Idea is not expected to be a major bidder due to its financial troubles.
Meanwhile a 5G spectrum auction is now tipped to be delayed until 2021 due to the poor financial health of the industry and worries the reserve price is too high to attract interest.
Both sales were originally scheduled to be held in 2019, but pushed to 2020 as the DoT had not finalised the pricing or amount of spectrum to be allocated.
In August 2019, the Confederation of Indian Industry warned the high reserve price set for the 5G auction would put additional downward pressure on mobile operators’ already sinking ARPU and slow growth of the sector.