According to rating agency Fitch, it is expected that the Telecom Regulatory Authority of India may recommend a lower base price for the spectrum in the 700 MHz and 3300 MHz – 3.6 MHz bands.
These bands are critical for the telcos when it will come to rolling out 5G services in India.
This will be good news for Bharti Airtel, Vodafone Idea (Vi), and Reliance Jio as they were hoping that the Department of Telecommunications (DoT) and the regulator would reduce the base price of spectrum in different frequency bands.
This was based on the fact that in September, DoT had asked TRAI to recommend new prices for the mmWave bands, 3.5 GHz bands, and 700 MHz bands. The telecom department had also asked the regulator to include the new 600 MHz bands in its recommendations. The 600 MHz band will help the operators in providing better coverage to the users.
So far the telcos have been avoiding the purchase of the 700 MHz spectrum because of its steep base price.
As per Fitch Ratings, the spectrum auctions for 5G airwaves are expected to take place in 2022. However, the rating firms said that the commercial launch is expected in 2023. If this is correct, India will have to wait longer to see live 5G networks.
Fitch Ratings further said that Airtel and Jio’s revenues are going to grow by 8 percent to 12percent in 2022. Moreover, the rating firm said that the average revenue per user (ARPU) of the telcos will increase on the back of possible tariff hikes and migration of legacy network users to 4G services.
Already telcos have set the ball rolling to convert legacy network users in India to 4G consumers with their smartphone offers.