COAI Advocates for Reduced Spectrum Auction Prices Amid 5G Investment Struggles
COAI seeks lower spectrum auction prices, moots idea of free radiowaves
Business StandardImage: Business Standard
The Cellular Operators Association of India (COAI) is urging the Indian government to lower spectrum auction prices, citing that telecom operators have yet to see returns on their significant investments in 5G infrastructure. COAI Director General S P Kochhar emphasized the need for a revised model for spectrum allocation as 5G and future 6G technologies evolve.
- 01COAI requests lower spectrum auction prices due to high 5G investment costs.
- 02The recommended base price for the upcoming auction is ₹2.1 lakh crore (approximately $25.3 billion USD).
- 03The new price is 19% lower than the previous auction held in 2022.
- 04Kochhar highlights the need for a new spectrum allocation model as 5G and 6G technologies advance.
- 05The government currently allocates spectrum for mobile services only through auctions.
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The Cellular Operators Association of India (COAI) is advocating for reduced spectrum auction prices ahead of the next auction, stressing that telecom operators have not yet recouped their substantial investments in 5G infrastructure. COAI Director General S P Kochhar stated that the high costs associated with spectrum acquisition pose a challenge for operators still awaiting returns on investment (ROI). The Telecom Regulatory Authority of India (Trai) has recommended auctioning 11,790 MHz of spectrum across various frequency bands, with a base price set at ₹2.1 lakh crore (approximately $25.3 billion USD), which is 19% cheaper than the previous auction in 2022. Kochhar urged the government to consider alternative models, noting that many countries offer spectrum for free but with specific obligations, suggesting that the current auction model may need to evolve with the advent of 5G and the upcoming 6G technologies. He emphasized that the cost of spectrum is the largest capital expenditure for telecom operators, and the government should provide support until operators begin to see ROI.
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If spectrum prices are lowered, telecom operators may invest more in expanding and improving mobile network coverage, potentially leading to better service for consumers.
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