Business News/ Industry / Telecom/  5G auction set to get delayed on private networks issue

5G auction set to get delayed on private networks issue

The auction is likely to get delayed beyond mid-July as the govt is yet to take final decision
  • BIF insists private networks were the Centre’s revenue generators & would not pose any threat
  • The Centre is inclined to permit carriers to provide 5G to companies on a leasing basis, while private companies are seeking direct allocation of 5G airwaves. (Photo: Mint)Premium
    The Centre is inclined to permit carriers to provide 5G to companies on a leasing basis, while private companies are seeking direct allocation of 5G airwaves. (Photo: Mint)

    NEW DELHI : The auction of 5G airwaves is likely to get delayed beyond mid-July as the government is yet to decide on the issue of private 5G networks that has become a bone of contention between telecom service providers and tech companies.

    According to a senior official, the government has been inclined to permit carriers to provide 5G services to private companies on a leasing basis; however, representations from several companies seeking direct allocation of 5G airwaves have been taken up for consideration.

    “It will be taken to the Cabinet. They will take a call along with other decisions," said the official. The Cabinet will also take a call on the pricing of 5G airwaves and the duration of the spectrum to be allocated post auctions. This is after the highest decision-making body within the telecom ministry, the digital communications commission (DCC), agreed with several of the recommendations given by the Telecom Regulatory Authority of India (TRAI).

    However, after a final decision from the Cabinet, the department of telecommunications will take some time before issuing the notice inviting applications, the formal document announcing the auctions and seeking interest from potential bidders. Experts said this could be as little as two weeks to a month. The auction takes at least 45 days from when the notice is issued.

    The issue of private 5G networks has become a key concern, with telecom service providers at loggerheads with the Broadband India Forum (BIF), comprising Tata Consultancy Services Ltd, Amazon India and Meta, among others. BIF insists that private networks were revenue generators for the government and would not pose a security threat as the networks were closed and disconnected from public telecom networks.

    In a position paper, Broadband India Forum emphasized that the government should have a forward-looking approach towards the use and advancement of technology while asking the government to earmark a certain amount of exclusive spectrum for private 5G networks in each type of spectrum band.

    “Allow direct allocation of spectrum to enterprises/organizations at a nominal administrative fee, as per global best practices," it said.

    “Facilitate a light-touch online portal based paperless regime for acquiring permission/license for ‘Captive Wireless Private Network (CWPN)’ within 30 days of application (as recommended by TRAI) to enable ease of doing business," the body led by technology companies has said.

    It has been argued that private 5G networks were best set up by enterprises themselves since public networks cannot deliver the levels of efficiencies required. It further said that such networks would constitute additional revenue streams for the telcos and the government since they will purchase the spectrum at a price fixed by the government and allocated administratively.

    The forum noted that the perception that spectrum can be assigned only through auction is grossly inaccurate and misleading, referring to the Supreme Court guidelines on spectrum allocation issued in 2012.

    It added that private 5G networks were not permissible for external communications, and the need for lawful monitoring, interceptions and the possibility of threats to national security does not arise at all.

    Indian telcos, on the other hand, have written to the government against the direct allocation of 5G airwaves to private companies as it will adversely impact the enterprise businesses of telecom companies and will leave no business case for the carriers to roll out 5G services.

    In a communication to telecom minister Ashwini Vaishnaw, the Cellular Operators Association of India (COAI), which represents Reliance Jio, Bharti Airtel and Vodafone Idea, has sought the government’s “urgent intervention" to protect the interest of telcos.

    The association said that giving away a dedicated spectrum for private captive networks will hurt the financial health of the telecom industry, which is on the path of revival after the government’s relief package last year.

    This comes in response to private companies, such as Tata Consultancy Services, seeking direct allocation of 5G spectrum, following recommendations of TRAI that had left it to the government to either license out the airwaves directly or through a leasing model via existing telcos.

    Gulveen Aulakh
    Gulveen Aulakh is Senior Assistant Editor at Mint, serving dual roles covering the disinvestment landscape out of New Delhi, and the telecom & IT sectors as part of the corporate bureau. She had been tracking several government ministries for the last ten years in her previous stint at The Economic Times. An IIM Calcutta alumnus, Gulveen is fluent in French, a keen learner of new languages and avid foodie.
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    Updated: 10 Jun 2022, 06:15 AM IST
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