TRAI gave nod to sale of 5G Spectrum

TRAI gave nod to sale of 5G Spectrum

Introduction :-

The Telecom Regulatory Authority of India (TRAI) recommended the auction of spectrum for offering 5G services for the first time in the country at a pan-India reserve price of about Rs.492 crore per MHz.

  • Hence, in its recommendations, TRAI has also called for over 43% reduction in the reserve prices of 700 MHz band spectrum — sought-after for high speed services.
  • Bidders can hold upto 100 MHz of 5G spectrum, in chunks of 20 units
  • No rollout obligations for winners of 5G spectrum and 5 year lock in for such Buyers to check potential misuse and windfall.

Prize Recommendations :-

  • For 1,800 MHz spectrum – widely used for offering voice services — the reserve price of ₹3,285 crore has been recommended.
  • For spectrum in 800 MHz band, 900 MHz band, 2100 MHz band, 2300 MHz band and 2500 Mhz band, the reserve price has been kept at ₹4651 crore, ₹1622 crore, ₹3399 crore, ₹960 crore, and ₹821 crore, respectively.
  • The prices for 2300 Mhz, 2500 Mhz and 3300-3600 Mhz are for unpaired spectrum.

Background:

  • It had no takers in the 2016 auctions due to high pricing. Around 60% spectrum remained unsold
  • Since then, the industry has witnessed strong consolidation, with only three main players – Bharti Airtel, Vodafone-Idea and Reliance Jio.

TRAI’s recommendations :-

  • They pointed out that there is an “urgent need” of audit of all allocated spectrum both commercial as well as spectrum allocated to various PSUs and government organisations. This should be done by an independent agency on a regular basis, it said.
  • For the 5G airwaves, i.e. the spectrum in 3300-3600 MHz, the regulator said it should be put to auction in the block size of 20 MHz. To avoid monopolisation of this band, there should be limit of 100 MHz per bidder, it added.

Global trends:

  • 5G spectrum to be auctioned for the first time in India
  • Globally, only South Korea has auctioned spectrum for 5G, while the US and Europe will do it by this year end.

TRAI:

The Telecom Regulatory Authority of India (TRAI) (set up under TRAI Act of 1997) came into being as a consequence of opening up of the telecommunication sector to the private operators.

  • It is a statutory body and the regulator of telecommunications sector in India
  • It consists of a Chairperson and not more than two full-time members and not more than two part-time members.
  • Its main objective is to provide a fair and transparent environment that promotes a level playing field and facilitates fair competition in the market.
  • TRAI regularly issues orders and directions on various subjects such as tariffs, interconnections, quality of service, Direct To Home (DTH) services and mobile number portability.

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