5G services set to drive spectrum demand: Trai

New Delhi, Aug. 2: Telecom regulator Trai on Thursday asserted that 4G and 5G services will drive demand for spectrum in the next round of auctions, contesting the view that financially- stressed firms are likely to tread cautiously despite steep price cuts for several previously unsold bands.

“Considering that 5G services are going to be implemented in near future, we expect there will be a definite demand particularly for bands where 5G ecosystem has been developed... Telecom operators will bid for it. This includes 700 MHz band that can be utilised for 5G,” Trai secretary S. K. Gupta told PTI.

He said that the Trai’s recommendations on reduced rates for 700 Mhz band took into account the price of the spectrum that was recently auctioned in markets like Singapore, Germany, Denmark, Turkey and Taiwan.

The Trai on Wednesday recommended auction of about 8,644 MHz of telecom frequencies at an estimated base price of ` 4.9 lakh crore. At around ` 6,568 crore per Mhz, the regulator has suggested a whopping 43 per cent cut in base price for the premium 700 Mhz frequency which had failed to attract buyers in the last auction held in 2016.

“We have clearly indicated that prices now recommended are in line with international trends. As far as financial health of sector is considered, the spectrum price has to be derived based on numerous factors, and more so this is only the reserve price. Industry will take care of requirements based on their need and strengths” Mr Gupta said.

Meanwhile, DoT said it will take a call on next round of auction of 5G spectrum identified by a high level committee after analysing Trai’s recommendations “Trai has just made recommendation. We are looking in to it,” Telecom secretary Aruna Sundararajan said.

When asked if DoT will seek reference from the Trai on various bands identified by high level committee on 5G, she said: “We will analyse Trai recommendations first. Then see if there is need and appetite for more spectrum in the industry after which a decision will be taken.”