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5G auction, players involved and how it will help in India’s development

India is all set for 5G services to start soon. The high-speed internet which is said to be 10 times faster than 4G, is introducing brand new services and business models.

The auction for 5G spectrum started on 26th July and will be closed by the end of July. The validity being for 20 years, the bidding is being done in three categories for telecom companies – low, mid and high. The auction is said to finish by end of this month (July). Players involved are Reliance Jio, Bharti Airtel, VI (Vodafone Idea) and the Adani group. Sunil Mittal, Bharti Airtel Chairman, stated that Airtel will be the key player and in forefront of bringing 5G connectivity to India, further giving a message to the shareholders named ‘onwards with courage and confidence’ that digital services in next few years adding billions of dollars to the revenue of the company. Introduction of 5G will also create more employment, new-age tech and business. 5G which is the fifth generation of high-speed internet, will be giving support to technologies like cars that are driverless, VR (virtual reality), etc.

Understand what 5G is

In telecommunication industry, 5G is the fifth-generation technology with high-speed internet for cellular networks, these 5G supporting mobile phones were already out in the year 2019, expected to have more than 1.7 billion subscribers all over the world by the year 2025 with a higher bandwidth connecting more devices and also with an improved quality of internet, better and faster downloading of videos in high quality, switching from one device to the other. 5G will offer modern solutions to modern day problems like e-health, augmented reality, advanced gaming experiences etc.

These are the four major players to bid for 5G auction in India, know how much have these companies deposited:

  • Reliance Jio deposited an EMD of Rs 14,000 crore
  • Airtel deposited Rs 5,500
  • VI (Vodafone and Idea) deposited Rs 2,200 crores
  • Adani group deposited Rs 100 crores

Airtel, Jio, VI and Adani group have deposited, combined together, Rs 21,800 crore. In accordance with EMD, telecom companies are eligible to bid up to Rs 1.9 Lakh Crores.

Allocation to telecom companies is likely to happen in the month of August. Government will be setting up 72GHz for auction. Reserve price pegs value will be at Rs 4.3 lakh crore

Under the categories: Low, Mid and High

  • Low – 600 Mhz, 700 Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz, 2300 Mhz, 2500 Mhz
  • Mid – 3.3-3.67 Ghz
  • High – 26 Ghz

For now, reports suggest that telecom companies will be using mid and high band spectrum for 5G connectivity and the speed is expected to be 10 times higher than 4G services. According to reports, 5G will roll out in India in the year 2023; however, the Airtel CTO had stated that they would launch 5G after 2-4 months of the auctions coming to an end. The bidders are allowed to make a transaction in 20 equal annual installments while securing NPV at the interest of 7.2%. No spectrum usage charges for spectrum obtained in the 5G auction. The bidders are to submit a financial bank guarantee along with performance bank guarantee. The testing for 5G network has also been started in a few selected areas. The TRAI (telecom regulatory authority of India) conducted pilot testing in 4 cities, decided by the telecom body

  • Delhi airport, Bangalore metro, Bhopal and Kandla port. Testing was done in 11 locations in Bhopal by making use of traffic lights, street lights, bus shelters
  • 5G network was also tested through the street furniture at the GMR International airport Delhi, MG road Metro station Bangalore.
  • Testing was being held by Vodafone Idea, Reliance Jio, Airtel and BSNL

 

Day 1: 4 rounds of bidding took place by Jio, VI, Airtel and Adani group and round 5 took place on 27th July

Ashwini Vaishnaw, the Telecom Minister said, “The response on the first day of the auction exceeded all expectations and will surpass the records of 2015, when revenue collection from auction stood at Rs 1.09 lakh crore”.

Cities that will receive 5G in the initial days are:

Bangalore, Delhi, Gurgaon, Mumbai, Kolkata, Lucknow, Pune, Chennai, Gandhinagar, Hyderabad, Jamnagar, Chandigarh, Ahmedabad

 

We have all been hearing about 5G being introduced anytime soon. Cellular companies even got out 5G supported phones in the year 2019. In the year 2017, 5G was a much spoken about topic and a high-level meeting was setup by the government of India in order to seek a roadmap to bring 5G into India by the year 2020. The fact that it was a foreign network being introduced made the Indian government skeptical about the reliability of the same, causing in delay.

  • Representing the next tech with a faster and better bandwidth
  • Ultra-low latency
  • More reliable in comparison to other networks
  • Augmented reality, Virtual reality, quicker downloads, live streaming will all be possible

 

Challenges India will face:

The fiber connectivity is not upgraded in India yet, and it currently stands at 30% of India’s telecom towers. In order for 5G to work efficiently, the number of towers will need to increase, double of 30%. Hardware challenge- The make in India concept where some foreign telecom OEMS are banned on which CSPs depend on. India will need the local 5G hardware in order for it to be successful. Pricing of 5G spectrum is 7 times higher than United Kingdom and a lot more expensive than the global average

Maintaining the global optimal 5G standard as the launch cost increases which India cannot afford currently. The 5G bands which work in 3 spectrum bands: low, mid and high, each comes with its own limitations. Low band has coverage; however, speed is limited to 100Mbps, serving commercial needs but not industries. Mid band has a fast speed and not a great coverage, creating signal issues. High band has a speed up to 20Gbps with a very narrow coverage

 

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