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Reliance Jio splashes out $11 billion in India’s 5G auction

Bharti Airtel, Vodafone Idea, and Adani also took part in the $19 billion spectrum auction

Reliance Jio has spent $11 billion in India’s $19 billion 5G spectrum auction, emerging as the telco which spent the most money on new spectrum.

India’s government is hoping to begin the rollout of 5G by October this year and has held an auction over the past week selling parts of the 5G spectrum, which ended yesterday.

The country’s telecoms minister, Ashwini Vaishnaw, said that companies bought 71% of 72GHz spectrum offered in the auction, as reported by Reuters. Other Indian telcos took part, including Bharti Airtel, Vodafone Idea, and a unit of Adani Enterprises.

Bharti Airtel won spectrum worth $5.4 billion while Vodafone won $2.4 billion. Adani, meanwhile, purchased spectrum worth around $27 million, with the company aiming to enter the private 5G network space instead of consumer services.

"We understand that the spectrum purchased is good enough to cover all the circles in the country," said Vaishnaw, referring to geographical areas of coverage. He added that India's 5G coverage will be very good over the next three years.

To help the telecoms sector which is low on cash, the government said it would allow auction winners to pay the amounts owed in 20 equal annual instalments.

In India's telco sector, Reliance Jio triggered a price war in 2016 which caused Bharti Airtel and Vodafone to both report losses in recent years, as well as being squeezed by spectrum dues from earlier auctions. Despite this, Bharti Airtel has made a profit recently thanks to mobile data price hikes.

"This spectrum acquisition...has been part of a deliberate strategy to buy the best spectrum assets at a substantially lower relative cost compared to our competition," Bharti Airtel chief executive officer Gopal Vittal said.

Reliance Jio said it would be ready to roll out 5G across India in the shortest period of time, without giving any specifics.

There are wide disparities in the rollout of 5G across the Asia Pacific region, according to a report from GSMA published in April 2022. Korea and Japan, for example, were among the first in the world to test and launch commercial 5G networks. However, other parts of APAC suffer from a lack of spectrum availability and cross-border coordination.

Countries like Bangladesh, Cambodia, Indonesia, Pakistan, Thailand and Vietnam will require enhanced roadmaps, said GSMA. However, it praised India for moving ahead with a robust consultation programme as it develops its plans for affordable connectivity.

“The most successful countries are those with a defined plan for 5G deployment,” said the GSMA’s head of spectrum, Luciana Camargos. “Across APAC, we see a wide disparity in countries’ readiness for 5G, and the key differentiator is spectrum management.”

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