From the auction of 5G spectrum, the government is targeting to raise ₹5.63 trillion
5G is seen as the next frontier in machine-to-machine communication, enabling secure connectivity between devices other than smartphones such as sensors, vehicles, robots and drones
New Delhi: Trials of fifth-generation (5G) airwaves will begin in 100 days and the first auction of 5G spectrum will be held this year, telecom minister Ravi Shankar Prasad said, more than two years after the failure of the last auction had temporarily halted spectrum sales.
The department of telecommunications (DoT) will auction spectrum for 5G and other bands in 2019, Prasad said after taking charge as telecom minister on Monday. “This calendar year we should auction...we have adequate spectrum," he said.
In August 2018, the Telecom Regulatory Authority of India (Trai) had recommended to DoT auction of 20 megahertz (MHz) blocks in the 3,300-3,600MHz spectrum band, the airwaves earmarked for 5G, at ₹492 crore per MHz. The regulator also suggested reserve prices for non-5G bands.
The decision on an early auction assumes significance as it is a major source of government revenue. The government had raised ₹65,789 crore the last time airwaves were auctioned in 2016-17.
The fate of this year’s auction is yet to be seen, with India’s largest telecom operator Vodafone-Idea Ltd suggesting 5G should not be auctioned before 2020, and Bharti Airtel Ltd, the second-largest operator , asserting that it will not bid at the current prices.
“Trials for 5G technology will begin in 100 days... It shall be our endeavour that 5G is used for deprived sectors and social causes as well," Prasad said.
5G is seen as the next frontier in machine-to-machine communication, enabling secure connectivity between devices other than smartphones, such as sensors, vehicles, robots and drones.
The government also aims to roll out 500,000 public Wi-Fi hotspots on priority, he said. This is expected to boost digital connectivity, shift a big chunk of internet traffic from mobile networks to cheaper and faster Wi-Fi networks, ease network congestion and potentially bring down call drops. Mint was the first to report on the project in its 30 May edition. Users can sign up with one hotspot operator and connect to hotspots of any other operator while on the move.
Expediting domestic manufacturing of telecom equipment and creating a broadband readiness index to rank states will be other focus areas for DoT.
“We will also take steps to revive Bharat Sanchar Nigam Ltd (BSNL) and the Mahanagar Telephone Nigam Ltd (MTNL) as the government believes that to maintain sober equilibrium in the industry, the public sector must be present and it is in the nation’s interest that they remain healthy. However, BSNL and MTNL also need to become professional and adopt a competitive attitude," Prasad said.
The two public sector undertakings have been making losses continuously since 2009-10 and have been declared “incipient sick". Amid fierce competition and rock-bottom tariffs after Jio’s entry in September 2016, salaries have become a heavy burden for the two companies. In the December quarter, MTNL’s salary cost at ₹577.2 crore exceeded its revenue of ₹514.5 crore. NITI Aayog, the federal think tank, has suggested that the company be shut down.
DoT, however, has been working on a revival plan for MTNL and BSNL, and has floated a cabinet note in this regard. The plan suggests a voluntary retirement scheme (VRS) for employees and BSNL’s land monetization. DoT plans to fund VRS packages for BSNL at ₹6,365 crore and for MTNL at ₹2,120 crore through bonds. BSNL has 176,000 employees, while MTNL has 22,000.
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