Lessons from spectrum auction

The much-awaited mobile spectrum auction that was postponed a couple of times, started on June 25 and ended in a couple of days. The auction lasted for about seven clock rounds, compared to 40 in the last held auction in 2022. Of the total of 12 GHz of spectrum put on the table across 800, 900, 1800, 2100, 2300, 2500, 3300 MHz and 26 GHz, jut about 2 per cent was sold. The government received ₹11,340.79 crore, which is about 11.77 per cent of the total reserve price of ₹96,317.65 crore.

As predicted in our part 1 article, the telcos participated in this auction mainly to get back the spectrum, the tenures of which are expiring soon.

The sub-GHz band saw action from Bharti Airtel and Vodafone Idea (VI). The 900 MHz band was picked up by Airtel and VI, with maximum action seen in Punjab, Rajasthan, Uttar Pradesh East, and West Bengal. However, surprisingly none of the operators, especially RJio, picked up the total available 118.75 MHz in the 800 MHz band. This could have complemented the 800 MHz holding of about 223 MHz that RJio already has across the country, thereby augmenting its capabilities in providing LTE and LTE-Advanced, especially in rural and remote areas of the country. While the financially struggling VI picked up an average of 2.08 MHz per Licensed Service Area (LSA), Airtel picked up 5.25 MHz per LSA with a large block of 10 MHz in Jammu and Kashmir.

The mid-band

We predicted that there will be limited action in the mid-band due to the telcos having enough bandwidth in the 1800 and 3300 MHz band. However, there has been some action in the 1800 MHz by Airtel and RJio, to consolidate their spectrum holding in the mid-band. While RJio picked up 14.4 MHz, Airtel acquired 35 MHz, the winning bid prices are not very different from the reserve price, except in Bihar, West Bengal, Madhya Pradesh, and Uttar Pradesh East. Surprisingly, smaller blocks in 2100 and 2500 MHz bands were also picked up, mainly in category-C LSAs such as Assam, Bihar, J&K and the North-East. These bands do not have good propagation characteristics and it is not clear why they were picked up for these LSAs.

The millimetre wave band

As predicted, the millimetre wave band did not witness any action, due to the large quantities won by the telcos in the 2022 auction. While the government announced that the auction outcome is as per expectations, especially in terms of revenue accrued, it is a loss for the telcos to have given up on acquiring more spectrum for better coverage and better quality of service.

India is unique compared to large countries such as the US and China. Both these countries have good landline broadband penetration at 80-90 per cent, while India’s landline broadband penetration is just around 10 per cent. Hence mobile broadband is the only way to provide quality Internet connectivity to all netizens of the country. Since spectrum is the resource through which connectivity is provided, having enough spectrum for the billion data users in the country is a prerequisite for providing affordable quality broadband connectivity.

The two major telcos — Bharti Airtel and Reliance Jio — have an average of about 1,000 MHz of spectrum in each LSA (also referred to as “spectrum depth”). This is half of about 2,000 MHz spectrum depth of the US carriers such as Verizon, AT&T Wireless and T-Mobile. Though we mentioned in our earlier article that this is better than what the telcos had about five years back, it is still less for meeting the ever growing demands of the users.

The process of auctioning spectrum periodically will provide better visibility regarding spectrum availability to the mobile service providers. The government and the regulator should review the reserve prices and adjust them accordingly so that they are not high enough to dissuade telcos from bidding in the forthcoming auctions. Spectrum, being a scarce resource, should not remain unused or under-used to deprive us of better connectivity.

Along with licensed spectrum, the government and the regulator should also device national strategies for the release of unlicensed spectrum in the 6 GHz and 60 GHz bands, so that they can coexist with the auctioned licence spectrum.

With the fillip given by the government to the deployment of Wireless Access Network Interface (WANI) projects across the country, it is time that the National Frequency Allocation Plan that was last revised in 2022 is revisited to meet the current and future spectrum requirements.

The writer is Professor at IIIT-Bangalore; with inputs from KR Mahaadevan, M.Sc. student at IIIT-Bangalore