On July 26, the Department of Telecommunications of the government of India will hold an auction for 5G spectrum. A total of 72097.85MHz of spectrum with a 20-year term will be auctioned off in the highly anticipated sale.
Reliance Jio Infocomm, Adani Data Networks Ltd, Vodafone Idea Ltd, and Bharti Airtel Ltd are the spectrum bidders. Reliance Jio has deposited Rs 14,000 billion as an earnest money deposit (EMD). Adani Group earned EMD of Rs100 billion. Bharti Airtel has provided 5,500 crore rupees as EMD, while Vodafone Idea has contributed 2,200 crore rupees. EMD represents the number of airwaves a business may bid on at an auction. Considering the deposit amounts, Reliance Jio looks to be the most competitive bidder.
Companies are aggressively bidding for 5G spectrum
Spectrum in various frequency bands will be auctioned off. The low-frequency band is comprised of 600MHz, 700MHz, 800MHz, 900MHz, 1800MHz, 2100MHz, and 2300MHz; the mid-frequency band is comprised of 3300MHz; and the high-frequency band is comprised of 26GHz. The spectrum can be purchased in 20 equal annual installments, each of which must be paid in advance at the start of each year.
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The bidders would have the option to relinquish the spectrum after ten years with no further obligations for balance payments. The government will only impose one-time spectrum costs in accordance with the Telecom Relief Package of September 2021. Spectrum use fee (SUC) has been eliminated for any spectrum obtained in the 5G spectrum auction.
For the uninitiated, there are many parties involved in the spectrum auction: the buyer, who are the service providers who purchase the spectrum bands; the seller, which in this case is the Union Government, represented in the bidding process by the DoT; and lastly, the end users.
5G technology testing have already been carried out by Samsung, Nokia, and Ericsson. Commercial 5G services are probably going to come in the following months thanks to the 5G spectrum auction. Because of the promise of 5G, businesses expect to make enormous sums of money.
As the government has created the 5G test bed enabling them to test and build 5G-based use cases, maybe we will see telecom companies flourish. The fourth Industrial Revolution, or Industry 4.0, which includes enhanced connectivity and automation, among other things, can be sparked by 5G. New business concepts and payment methods may result from this. 5G services, which are 10 times quicker than 4G, are anticipated to increase mobile data demand.