scorecardresearchAdani's 5G entry: Airtel falls 5%; Vodafone Idea up 3%

Adani's 5G entry: Airtel falls 5%; Vodafone Idea up 3%

Updated: 11 Jul 2022, 12:10 PM IST
TL;DR.
The telecom companies in the run-up to the auction bitterly opposed any direct allocation of spectrum to non-telecom entities for setting up private captive networks as it would severely impact their businesses.
The fourth applicant for the 5G spectrum was Adani Group, which recently obtained National Long Distance (NLD) and International Long Distance (ILD) licences.

The fourth applicant for the 5G spectrum was Adani Group, which recently obtained National Long Distance (NLD) and International Long Distance (ILD) licences.

Shares of the leading telecom players were under pressure in Monday's trade with Bharti Airtel leading the losses.

Shares of Bharti Airtel have dropped 4.65% at 663.00 on the BSE at 11:30 am (IST) during Monday's intraday trade. While the Vodafone Idea traded in the green in Monday's trade up by 4.17% to 8.75.

Reliance Industries, the parent company of Reliance Jio, was trading at 0.52 per cent lower at 2,379.

On Saturday, Billionaire Gautam Adani's group confirmed its entry into the race to acquire telecom spectrum. saying it will be used to build a private network to support its businesses ranging from airports to power and data centres, PTI reported.

 

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Adani Group plans to use the airwaves for its data centre as well as the super app it is building to support businesses from electricity distribution to airports, and gas retailing to ports, the report said.

"As we build our own digital platform encompassing super apps, edge data centres, and industry command and control centres, we will need ultra high-quality data streaming capabilities through a high frequency and low latency 5G network across all our businesses," Adani Group said.

The telecom companies in the run-up to the auction bitterly opposed any direct allocation of spectrum to non-telecom entities for setting up private captive networks as it would severely impact their businesses. They wanted the non-telcos to lease out the spectrum from them or they set up private captive networks for them. But the government weighed in favour of private networks.

In June, the government permitted non-telecom players to establish captive private networks.

Meanwhile, applications for participating in the July 26 auction of airwaves, including those capable of providing fifth-generation or 5G telecom services such as ultra-high-speed internet connectivity, closed on Friday with at least four applications. Jio, Airtel and Vodafone Idea the three private players in the telecom sector applied. The fourth applicant is Adani Group, which recently obtained National Long Distance (NLD) and International Long Distance (ILD) licences.

As per the auction timelines, ownership details of applicants are to be published on July 12 and the bidders should be known then. A total of 72,097.85 MHz of spectrum worth at least 4.3 lakh crore will be put on the block during the auction, set to commence on July 26, 2022. The auction will be held for spectrum in various low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz) and high (26 GHz) frequency bands.

Last month, the cabinet approved the Telecom Regulatory Authority of India's recommended reserve prices for 5G auctions. The regulator had suggested a reduction in the floor price of the 5G spectrum for mobile services of nearly 40 per cent.

Moreover, the 20-year duration of the right to use the spectrum has been extended, and generally, the payment terms for participants in the next auction have been lowered. The winning bidders are not required to make an upfront payment for the first time ever.

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First Published: 11 Jul 2022, 12:09 PM IST