There are lessons to be learnt from India’s 700 MHz auction
Some good can hopefully come of the failed sale of 700 MHz spectrum licenses from the latest multi-band auction in India.
For regulators around the world planning to auction digital dividend spectrum, and indeed for India who is likely to reauction it, it serves as a great lesson in how things can go wrong.
The Indian regulator TRAI and the country’s government bet mobile operators would be willing to pay sky-high prices for spectrum in the 700 MHz band. But as the GSMA and other stakeholders had cautioned, the spectrum went unsold because the reserve (opening) prices were set at an unrealistic US$60 billion for covering the entire country.
It has to be said, high reserve prices resulting in unsold 700 MHz spectrum in Australia and Senegal should already have made it abundantly clear what not to do.
Why is getting 700 MHz assigned now so important? The answer is easy: most people getting connected during the next couple of years live in rural areas. The band’s technical characteristics to support better coverage of these wide open spaces makes it a perfect fit to connect millions more.
In India, networks using 700 MHz could have played a major role in making the Digital India vision come true. They could have helped improve rural coverage and in the process improve financial inclusion and the availability of government services, for example.
The GSMA now urges the Indian regulator TRAI to reengage with stakeholders and revisit the pricing on 700 MHz, leading to a successful assignment of this valuable spectrum.
The Government’s assertion the APT700 version of the band is being held back by a lack of ecosystem is not true. The number of devices that can use the band is snowballing; up 26 percent to 469 in just the last three months.
Granted there are other bands with wider support, but this near-global band has great traction. Another lost opportunity is that a market like India could have helped the ecosystem grow to another level.
Auctions that end with unassigned spectrum should concern us all. They prevent all of us from getting the most possible out of mobile networks and the benefits that come with that.
Spectrum holds no value until it is fuelled by investments from mobile operators, which ultimately improves coverage and increases speeds. Spectrum pricing should make these investments possible, not undermine them.