India’s mobile operators want the country’s next spectrum auctions pushed back to late 2018 or early 2019, which is at least a year later than the H2 2017 target suggested by the Department of Telecommunications (DoT).
Rajan Mathews, DG of operator industry association Cellular Operators Association of India (COAI), told The Economic Times (ET): “The timing [of the auctions] should be the latter part of 2018 and early part of 2019 once all the consolidation has been announced and locked down. Only after that would companies look at any additional spectrum needs after they put their networks together.”
The DoT last week asked regulator TRAI to suggest the reserve prices for 4G and 5G spectrum across at least seven bands. In early March the government announced plans to hold auctions this year for 5G spectrum in frequencies above 3GHz as well as additional spectrum across seven bands left unsold in an October 2016 auction. The sale was the country’s largest ever, generating $9.8 billion for the government, but 60 per cent of the available spectrum was not sold, including 700MHz.
To make the latter attractive to operators, analysts say the reserve price needs to be cut sharply from the INR11.5 billion ($178 million) per MHz previously set.
The already competitive India mobile market is facing even more intense competition as Reliance Jio’s entry in September 2016 pushed data prices down and sparked a round of operator consolidation, with at least three mergers confirmed or being negotiated.
Vodafone Group and Aditya Birla Group, owner of Idea Cellular, agreed in March to merge their Indian operations, which will create the country’s largest mobile operator. Market leader Bharti Airtel in January struck a deal to acquire Telenor’s operations in India. The combined company will have about a 30 per cent market share. Number six Reliance Communications (RCom) entered into negotiations with Tata Teleservices in February.
Mathews said the suggestion to push the auctions back a year and to offer a more competitive price for the 700MHz band will be expressed during the auction consultation process, which is yet to start, ET reported.