Reliance Industries Jio emerged as the biggest spender in India’s $19 billion (about Rs 1.5 lakh crore) 5G spectrum auction, with the top telco player winning $11 billion (about Rs 87,000 crore) worth of airwaves as the world’s number two mobile. The market is ready for high-speed wireless networks.
The Indian government aims to start the rollout of 5G – which it says can deliver data speeds about 10 times faster than 4G – by October this year. Globally, the next-generation network is seen as critical to emerging technologies such as self-driving cars and artificial intelligence.
The country’s telecom minister said the companies bought 71 percent of the total 72 GHz spectrum offered in the auction, which ended on Monday and saw participation from Jio rivals Bharti Airtel and Vodafone Idea, as well as a unit of Adani Enterprises.
Airtel and Vodafone won spectrum worth $5.4 billion (about Rs 43,000 crore) and $2.4 billion (about Rs 19,000 crore) respectively.
“We understand that the spectrum purchased is good enough to cover all the circles in the country,” telecom minister Ashwini Vaishnaw told a press briefing, referring to geographical areas of coverage. India’s 5G coverage will be “very good” over the next three years, he added.
The telcos bid aggressively despite earlier concerns they could lose about 40 percent of potential revenue due to some airwaves being allotted to enterprises for private 5G networks.
Adani, the new entrant to the auction process, bought AirWave for around $27 million (about Rs 215 crore). The firm does not plan to offer consumer services and instead aims to enter the personal 5G network space.
To help the cash-strapped telecom sector, the government is allowing auction winners to pay the outstanding amount in 20 equal annual installments.
Airtel and Vodafone are under pressure after Jio started a price war in 2016 and both have reported losses in recent years, also weighed down by spectrum arrears from previous auctions. However, recent mobile data price hikes have helped Airtel return to profitability.
This spectrum acquisition…has been part of a deliberate strategy to buy the best spectrum assets at a significantly lower relative cost than our competition,” Airtel CEO Gopal Vittal said in a statement.
Jio said it would be ready for the 5G pan-India rollout “within the shortest possible time”, without giving specifics.