Telcos likely to show little interest in upcoming spectrum auction

The upcoming spectrum auction, which is likely to be conducted over the next three months, is likely to receive a cold response from telecom companies, Financial Express (FE) has reported. Compared to the last 5G spectrum auction, which fetched the government Rs 1.5 trillion, this auction is likely to add Rs 8,000-9,000 crore to the government's kitty, officials in the know told the newspaper.

What is the reason behind the cold response from telcos?

The telcos already have ample spectrum with them. With little scope for 5G monetisation, telecom companies do not see the need to spend towards acquiring more spectrum. According to the FE report, Jio Infocomm and Bharti Airtel are likely to spend a combined total sum of Rs 75,000 crore in the financial year 2023-24 (FY24).

The government is expected to auction spectrum bands in 600 MHz, 700 MHz, 800 MHz, 900 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300-3670 MHz, and 26 GHz, the report said. Apart from this, renewal of spectrum is pending in 900 and 1800 MHz bands in eight circles, which include Uttar Pradesh (East), Uttar Pradesh (West), West Bengal, Assam, Bihar, Jammu and Kashmir, North-East, and Odisha in February by Airtel and Vodafone Idea.

Bharti Airtel's managing director and chief executive officer, Gopal Vittal had said that the company will spend little money on the future spectrum auctions as it does not need additional airwaves, the FE report said.

Last spectrum sale in 2022

During the last spectrum sale in 2022, airwaves with a validity of 20 years were on offer. During this, Reliance Jio spent Rs 88,078 crore towards acquiring 5G spectrum; this was followed by Bharti Airtel, which bought Rs 43,084 crore worth of airwaves. Vodafone Idea spent Rs 18,799 crore during the last spectrum, the FE report said.