Reliance Industries Jio emerged as the biggest spender in India’s $19 billion 5G spectrum auction. The top telco player is poised for high-speed wireless networks as the world’s No. 2 mobile market, winning $11 billion in airwaves.
By October this year, the Indian government aims to begin the rollout of 5G, which it says can provide data speeds of about 10 times faster than 4G. Globally, next-generation networks are critical to emerging technologies such as self-driving cars and artificial intelligence.
The country’s telecom minister said the companies bought 71% of the total 72 GHz spectrum offered in the auction, which concluded on Monday and included a tie-up of Jio rivals Bharti Airtel and Vodafone Idea as well as Adani Enterprises Ltd (ADEL). unit also participated.
Airtel and Vodafone won a spectrum worth $5.4 billion and $2.4 billion, respectively.
“We understand that the spectrum purchased is good enough to cover all the circles in the country,” telecom minister Ashwini Vaishnaw told a press briefing, referring to geographical coverage areas. He added that India’s 5G coverage would be “excellent” over the next three years.
Telecom companies bid aggressively despite earlier concerns that they could potentially lose around 40% of revenue if some airwaves are allocated to enterprises for private 5G networks.
Adani, the newest entrant to the auction process, bought the airwaves worth around $27 million. The firm does not plan to offer consumer services and instead aims to enter the private 5G network space.
To help the cash-strapped telecom sector, the government allows auction winners to pay the dues in 20 equal annual instalments.
Airtel and Vodafone have been under pressure since Jio triggered a price war in 2016, with both reporting losses in recent years, also squeezed by spectrum dues from earlier auctions. However, recent mobile data price hikes have helped Airtel creep back to profit.
“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,” Airtel Chief Executive Officer Gopal Vittal said in a statement.
Jio said it would be ready for a pan-India rollout of 5G “in the shortest time, ” without giving specifics.