Government Might Reduce 5G Spectrum Prices To Encourage Telecom Operators

In order to help telecom players, the government is likely to slash the price of the 5G spectrum, if they (operators) choose non-Chinese equipment maker. This means the Department of Telecommunication (DOT) is encouraging all operators not to opt Huawei and ZTE.

The development comes after telecom operators have raised questions on the base price of the 5G spectrum. In fact, Airtel has already confirmed that it will not buy 5G airwaves due to its high pricing. However, the situation has been changed, and now DOT is reportedly planning to slash the prices, reports Economic Times.

The report states that this move will increase the prices of 5G deployment in the country. "Procurement procedures are being reworked, surveillance has become a global issue and companies such as Huawei and ZTE whose ownership is questionable are going to increasingly find it tough to get contracts," Official said.

Besides, the government has asked both BSNL and MTNL to use vendors like Nokia, Ericsson, and Samsung. In fact, it is expected that it will increase the cost by 15 to 20 percent, and this will affect the revenues of telecom operators.

Government To Auction 4G Airwaves

Meanwhile, the government is planning to auction 4G airwaves this year in October, while 5G prices are under consideration. Furthermore, it is expected that the government might delay the 5G auction until 2021.

Notably, the Telecom Regulatory Authority of India (TRAI) has suggested Rs. 492 crore per MHz, where the government is likely to put 8,300 MHz airwaves under the 5G spectrum auction, and it is expected to garner 5.3 trillion. However, TRAI defended its pricing and said that it has decided after consideration with stakeholders.

"TRAI has recommended the reserve pricing after taking into account the feedback and comments from various stakeholders and has given that to the government," the regulator said. Adding to that, "Stakeholders will decide whether they want to participate in the auction or not."