Typically it is telecommunications companies that bid for spectrum and then provide the service to enterprises as well as to retail consumers. However, now, there are several private companies champing at the bit ahead of the 5G auction.

The reason being that if private entities acquire spectrum, then they can offer a private, captive 5G network solely for the use of their client(s). Recently, the Cellular Operators' Association of India (COAI) had even written to the government advising against allowing private players in the auction on the ground that it will be detrimental to their business and that they are more than capable of meeting enterprise needs.

This begs the question, should private entities bid for 5G spectrum or be allowed to purchase it at an administered price?

According to reports, various enterprises are seeking spectrum allocation and are not looking to purchase it at the reserved price. These enterprises have been arguing that this would be a private network — not for public use — and therefore should not be looked at in terms of revenue generation or revenue maximization.

What is interesting is that industry bodies like the Broadband India Forum (BIF) have made very explicit representation saying that the Department of Telecommunications (DoT) should consider the allocation of the spectrum in question instead of auctioning them to the enterprises.

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After the cabinet approval for the 5G spectrum auction, the notice inviting applications (NIA) that had been issued by the telecom ministry very clearly specified that that window is open for spectrum to these enterprises, but had not prescribed what format that will take, its allocation or auctioning process.

It is understood that the DoT has yet to decide whether or not allocation to enterprises can take place in the first place. This can be tricky given that there have been conflicting judgments given by the Supreme Court on whether or not the auction is the prescribed route or whether there can be other means of assigning natural resources — in this case, spectrum — to the players in question.

The government is also likely to consider the opinion of the attorney general, but so far the takeaway is that there remains a big question mark — the DoT foresees legal hurdles and therefore, will consult the attorney general in the matter.

Watch the accompanying video of CNBC-TV18’s Ashmit Kumar for more details.

First Published:Jul 1, 2022 3:46 PM IST