Don’t let the Govt’s call for the largest airwave auction in history fool you just yet

With the cabinet’s nod to a fresh round of auction of 700mhz of premium spectrum sometime by August 2016, the department of telecom is now gearing up for the single largest commercial auction of airwaves ever done. And this time around, the total bandwidth being auctioned is 2000mhz.

Clear Benefits

Here’s why the premium 700mhz band can be an answer to all our woes. To start with it’s an LTE band; it can provide high speed internet connectivity and interruption free voice calls. Due to its low frequency, the band will be able to provide the most effective indoor coverage and better connectivity in remote areas. Low frequency will also mean lesser investment in infrastructure with fewer telecom towers. Over 40 countries all over the world primarily use the 700mhz band for 4g or LTE services. These countries include the likes of US, Australia, Singapore and even countries like Brazil and Nepal.

Sounds perfect, doesn’t it? And the government now has given its stamp of approval in order to put the band under the hammer in the upcoming spectrum auction that is likely to happen by August 2016.

So where is the problem, you ask. Here’s a quick recap first.

There has been a lot (I mean a LOT) of back and forth between the telecom regulator and the telecom department on 700mhz band with the telecom companies chiming in every now and then.

Big telecom companies like Airtel, Idea and Vodafone had asked the DoT and TRAI to not auction the 700mhz band just yet, as there is not much demand for the band at this point, the DoT backs the thought too, but the TRAI (Telecom Regulatory Authority of India) has been adamant, looking at the widened subscriber base and manifold jump in data traffic, that there could be a demand for the 700mhz band and therefore it should be auctioned now.

The obvious, yet big problems

Two key concerns for telecom operators have always been availability of spectrum and the pricing of spectrum. In the case of 700mhz band, TRAI is making spectrum available, but operators are asking the regulator to hold on. And in the case of the pricing of 700mhz band, it is now the most expensive spectrum band priced at 11, 500cr which is four times the price of the 1800mhz (Frequency also used for providing 4G services) that was auctioned a few years ago. Needless to say, operators are not happy.

While telecom operators are dealing with issues such as availability of spectrum and its pricing, another big concern that directly affects the consumers like you and me, is the ecosystem for the new technology. There is still very limited number of smart phones that support the 700mhz LTE band in India. Which means even if the government auctions it and operators buy it, it will still be a few years before we get to experience the technology. Just how it happened in the case of 2300mhz(4G) auction that took place in 2010. It’s only very recently that we have seen major telecom operators like Airtel, Vodafone, Idea launching their 4G services and Reliance Jio, the sole operator that won 4G spectrum in all the circles and potentially the biggest 4G player, is yet to officially launch its 4G services even after 6yrs.

So just in case you are getting excited in anticipation of being able to use high speed, super fast internet on the 700Mhz band, please don’t let any developments around it fool you just yet. You still have a good couple of years to be able to experience this technology and may I remind you, we are still dealing with call drops!

(Image: Indiatimes)