• This major effort should boost 5G, lay the foundations for 6G and shrink the digital divide by bringing competitive services to rural and underserved areas
• Simplified and relaxed licensing protocols will lower the barriers faced by aspiring new service providers 
• TRAI suggests introducing a mandatory 35% cap on total spectrum holdings by individual telcos 
• If recommendations are adopted, the reserve value of the spectrum up for grabs would be $23.1bn

The Telecom Regulatory Authority of India (TRAI) has issued a “recommendation” to the national government that the entirety of the available radio frequency (RF) spectrum relating to nine frequency bands across the sub-continent should be auctioned as soon as possible, with a suggested reserve value for the spectrum assets set at about $23.1bn. 

The regulator’s recommendations on the auction of radio frequency spectrum in the frequency bands identified for international mobile telecommunications (IMT) are designed to boost 5G services and lay the foundation for 6G, with a focus on both urban and rural coverage. IMT is the set of global standards for the cellular communications sector as defined by the International Telecommunications Union (ITU).  

The TRAI document, summarised here, proposes two revolutionary changes. The first is that the considerable and byzantine barriers that, currently, must be negotiated by potential new entrants to the massive and burgeoning Indian communications services sector should be relaxed and simplified.

The second is that a mandatory and uniform 35% cap on total spectrum holdings by individual service providers and telcos be imposed to ensure that the sector remains competitive and cannot slowly mutate and coalesce into a de facto club of just a handful of established players that would dominate the vibrant sector to the disadvantage of rivals, customers and the broader ecosystem.  

Simultaneously, the regulator is pressing India’s Department of Telecommunications (DoT) to move immediately to claw-back and reclaim spectrum held by moribund and insolvent telcos and then include it in the prospective huge and lucrative auction. 

The TRAI proposal covers spectrum auction details, including applicable reserve price, band plan, block size and “other associated conditions for spectrum bids,” and recommends that any resulting licences should be valid for a period of at least 20 years.

In its statement, the TRAI notes that “the entire available spectrum in the 600 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300 MHz and 26 GHz frequency bands should be put to auction in the forthcoming auction”. 

The 35% spectrum cap will apply across all those low-, mid- and high-frequency ranges as well as the 37-40 GHz band. Pragmatically, given the circumstances and likely legal action by current licence holders, the TRAI does not require those operators whose spectrum holdings already exceed the 35% to surrender their existing holdings.

Quite what this will mean in practical terms as the auction plays out remains to be seen. In an effort to incentivise the 600 MHz band, the regulator proposes that licences granted for that band last for 24 years (rather than the current 20 years). Other sweeteners include a four-year-long moratorium on payments and up to a four-year delay in the network deployment obligations that are an integral part of the granting of the licence in the first place.  So, plenty of latitude for those wanting to take a punt.

Satellite interference considerations

The TRAI statement says the upper 6 GHz band (6425-7125 MHz) is to be reserved for IMT (mobile services) but will not be auctioned until exhaustive technical trials ensure there is no interference with satellite stations. 

The regulator adds that the DoT has plans to mandate that all Indian telecom operators must conduct trials around all 34 places where satellite uplink stations are located in the relevant frequencies (in-band and adjacent frequencies) to determine the requirement of the ‘keepout distance’ of IMT base stations from satellite uplink stations to mitigate interference from 5G/IMT base stations.

Generally, separation distances for adjacent frequency bands range from several kilometres for suburban macro-cells to less than one kilometre for small-cell deployments.

The TRAI text also notes that “the available frequency ranges in the 6 GHz (upper) band, viz. 6425-6725 MHz and 7025-7125 MHz, should not be put to auction in the forthcoming auction. The issue of auctioning the spectrum in the 6 GHz (upper) band should be re-examined after considering the outcome of WRC-27”, the ITU World Radiocommunication Conference 2027 that will take place from 18 October until 14 November 2027 in Shanghai, China. Given those dates it is evident that nothing much is likely to happen with regards to the upper 6 Ghz band until sometime in 2028.

As part of an ongoing national effort to bridge India’s still yawning digital divide, the regulator is also proposing to apply a “coverage-for-discount” kind of scheme that allows successful bidders to offset up to 10% of their spectrum auction costs by expanding services into so-called “dead zones”. Thus, telcos will be able to claim a price reduction in exchange for deploying new 4G or 5G base stations in government-identified “coverage holes” within one year.

Additionally, to boost connectivity in remote and underserved areas, the TRAI has ruled that any towers built under the coverage-for-discount scheme must be shared with competing telcos “at a fair price”. Quite what that might mean remains obscure, but the mandate is designed to ensure that those people living in areas that, hitherto, have not been able to benefit from service improvements and competitive tariffs because they have been locked in to a single network provider will be able to switch to alternative service providers.

Obviously, a great many complex details remain to be settled but the TRAI and DoT, whilst not setting a definitive date for the spectrum auction, have indicated that they want it to be held sometime this year, which is a very short timetable given the complexity of the task. 

In total, if the DoT accepts the TRAI’s recommendations and opts to include all 11,790 MHz of spectrum in the next auction, the value of that spectrum would be, based on the TRAI’s suggested reserve prices, at least 2.1tn rupees ($23.1bn).   

The auction will use the simultaneous multiple-round auction (SMRA) format and TRAI’s comprehensive and far-reaching set of recommendations is an era-defining moment that should change India’s direction of digital travel for many years to come. By keeping the 6 Ghz band for IMT and delaying the auction of that spectrum until after the ITU’s WRC-27 conference, India is prepping for an ultra high-tech 6G future whilst expanding the nation’s 5G ecosystem. 

Significantly, the plans call for a fresh valuation exercise for spectrum to be applied every three years, with “indexed auction-determined prices to guide interim auctions”. 

By any measure, the Indian regulator’s proposals, if adopted, should have profound consequences. It’s a very bold move that may well be opposed by the vested interests of the established service providers whose attitude to change is frequently one of grave suspicion and automatic opposition but, if handled properly and equitably, the new regime ought to result in a revitalised sector providing a route to a 6G future for India whilst, simultaneously, increasing competition and helping to bridge the digital gap between rural and urban environments.

– Martyn Warwick, Editor in Chief, TelecomTV