Ushering in of 5G services on the anvil as spectrum auction gets Cabinet nod

Auction scheduled for July-end will assign spectrum to successful bidders for providing 5G services to the public and enterprises.

With digital connectivity prime on the government menu of public policies, the need to spruce up the strength of communications networks have become imperative. The government has Digital India, Start-up India and Make in India as its flagship programmes, and these call for an added push in connectivity. The Union Cabinet’s nod for a proposal by the Department of Telecommunications towards organising the spectrum auction comes as a step towards this.

Significantly, the auction will assign spectrum to successful bidders for providing 5G services to public and enterprises. The move will usher in 5G connectivity to the masses, and it is expected that the roll-out of the technology would bring about 10 times higher speed than what is possible through the current 4G services.

Post the decision taken by a meeting of the Union Cabinet headed by Prime Minister Narendra Modi, the government put out a statement saying that mobile broadband has become integral part of the daily lives of the citizens, and that it has received a big boost through the rapid expansion of 4G services across the country since 2015. As many as 80 crore subscribers today have access to broadband, in comparison with the 10 crore in 2014.

Plan to launch domestic 5G tech gains speed

Broadband services have proved to be of much aid to many policy initiatives and has prompted the government to go about promoting access to mobile banking, online education, telemedicine, eRation and the like to Antyodaya families. According to the government, the 4G ecosystem is now leading to 5G indigenous development. The 5G test bed setup in 8 top technology institutes of India is speeding up the launch of domestic 5G technology in India. The Production-Linked Incentive schemes for mobile handsets, telecom equipment and the launch of the India Semiconductor Mission are expected to help build a strong ecosystem for the launch of 5G services in India. The government foresees that India would emerge as a leading country in field of 5G technology and the upcoming 6G technology.

The statement said that spectrum being an integral and necessary part of the entire 5G eco-system, 5G services have the potential to create new age businesses, generate additional revenue for enterprises and provide employment arising from the deployment of innovative use-cases and technologies.  As per the Cabinet decision, a total of 72097.85 MHz of spectrum with a validity period of 20 years will be auctioned by the end of July this year.

The auction will be held for spectrum in various Low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), Mid (3300 MHz) and High (26 GHz) frequency bands. While Mid and High band spectrum will be utilised by telecom service providers to roll-out of 5G technology-based services, the end consumers would be offered speed and capacities 10 times higher than what are available today.

New norms for bidders announced

The government has also brought a slew of progressive options on spectrum to be acquired by bidders through the upcoming auction so as to facilitate ease of doing business. As per this move, successful bidders will not have to make an upfront payment.

They will be given the option of making the payments for spectrum in 20 equal annual instalments, and these will have to be paid in advance by the beginning of every year. The new move is expected to ease cash flow requirements and lower the cost of doing business in the telecom sector. Further, the bidders would get the choice of surrendering the spectrum after 10 years with no future liabilities with respect to balance instalments.

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