2024's telecom spectrum auction will not be as big as last round of 5G auction: Ashwini Vaishnaw

Ashwini Vaishnaw

This year's telecom spectrum auction will not be as big as last year's 5G auction as the industry has already obtained most of the spectrum in the previous round of auction, Union Minister for Communications, Electronics & Information Technology Ashwini Vaishnaw told reporters on February 1 after the Interim Budget 2024.

He said that the government is moving fast on organising the next round of spectrum auctions.

“...the next spectrum auction will be a limited auction because an already large part of the spectrum required by the industry was auctioned last year. Every financial year, we are trying to have one auction. We are working on a proposal. Wherever required or wherever smaller chunks are left out will be put to auction,” Vaishnaw said. “This will not be as big as the last round. This will be a significantly smaller auction.”

The Department of Telecommunications (DoT) will soon issue a notice inviting applications (NIA), the legal document laying down auction rules and processes.  Auctions typically start 45–50 days after the NIA is issued.

The department will also get a go-ahead on reserve prices for the upcoming auctions from the Cabinet, which may be kept at the same level as the 2022 auctions.

“The telecom sector is in very robust health today. Growth is visible, and the expansion of the telecom network is visible to all of us. Usage of data has increased,” Vaishnaw said.

The government is looking to earn Rs 1.20 lakh crore from communication services in the financial year 2024-25 through license fees and spectrum charges from the telecom players, as per Interim Budget documents released on February 1.

“...even though we are the most affordable telecom sector in the world today, the overall government revenue is a fraction of the total revenue...as a formula that is increasing,” the minister said.

Bharti Airtel and Vodafone Idea will go for renewing the older licences that will expire in the 4G bands of 1,800 Mhz and 900 Mhz. Renewal of spectrum is due in 900 and 1800 MHz bands in eight circles – Uttar Pradesh (East), Uttar Pradesh (West), West Bengal, Assam, Bihar, Jammu and Kashmir, North-East, and Odisha in February.

Airtel and Vodafone Idea may be given a provisional spectrum on the prices determined in the 2022 auction.

In the last spectrum auction 2022, the government had put 72,097.85 MHz of spectrum for auction with a validity period of 20 years. Reliance Jio spent Rs 88,078 crore towards 5G spectrum, followed by Bharti Airtel at Rs 43,084 crore, and Vodafone Idea at Rs 18,799 crore.

The government is expected not to put the 600 Mhz band on sale this year as it expects little demand for the pricier spectrum.