After delays, the government today announced that the Union Cabinet has approved the proposal of the Department of Telecommunications (DoT) to conduct the spectrum auction, through which spectrum will be assigned to the successful bidders for providing 5G services to public and enterprises.
A total of 72097.85 MHz of spectrum with a validity period of 20 years will be put to auction, and the government has planned to conduct the auction by the end of July, 2022.
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.
DoT has announced that it will accept applications from the bidders starting from 1st till 8th July 2022. After that, it will publish the ownership details submitted by the applicants, who have not otherwise been disqualified before then, and they need to submit an undertaking confirming that it complies with the ownership restrictions before 14th July 2022.
The government expects that the Mid and High band spectrum will be utilised by Telecom Service Providers for the roll-out of 5G technology-based services.
For the first time ever, the government said that there is no mandatory requirement to make upfront payment by the successful bidders. “Payments for spectrum can be made in 20 equal annual instalments to be paid in advance at the beginning of each year,” said the government.
This is expected to significantly ease cash flow requirements and lower the cost of doing business in this sector. The bidders would be given an option to surrender the spectrum after 10 years with no future liabilities with respect to balance instalments.
The availability of sufficient backhaul spectrum is also necessary to enable the roll-out of 5G services. To meet the backhaul demand, the Cabinet has decided to provisionally allot 2 carriers of 250 MHz each in E-band to the Telecom Service Providers. The Cabinet has also decided to double the number of traditional microwave backhaul carriers in the existing frequency bands of 13, 15, 18 and 21 GHz bands.
Enterprises setting up private captive networks may obtain the spectrum directly from the DoT and establish their own isolated network, said DoT. This is to enable the development and setting up of Private Captive Networks to spur a new wave of innovations in Industry 4.0 applications such as machine to machine communications, Internet of Things (IoT), Artificial Intelligence (AI) across automotive, healthcare, agriculture, energy, and other sectors.