Reliance Jio has acquired radio waves that are suitable for use with 5G technology
Reliance Jio Infocomm Ltd., led by billionaire Mukesh Ambani, emerged as the highest bidder in the $ 11 billion radio wave auction as the country’s largest wireless operator seeks to cement its competitive advantage over rivals.
Reliance Jio bought radio waves worth 571.23 billion rupees ($ 7.8 billion) out of the total 778.2 billion rupees raised in the latest spectrum auction, Telecom Secretary Anshu said on Tuesday. Prakash to journalists in New Delhi. Rival Bharti Airtel Ltd. spent $ 2.6 billion, while Vodafone Plc’s India unit acquired spectrum worth Rs 19.9 billion.
In total, about 60% of the spectrum offered was sold, according to Prakash, who said the offers were made at the minimum price, or minimum price acceptable to the government. Some spectrum bands were not sold either, as wireless operators cracked down after years of a price war unleashed by Jio that weighed on balance sheets.
“Given the Covid scenario and other stressful situations facing the sector,” the collection exceeded the government’s expectations, Prakash said. “We are happy that the industry is confident and has opted to acquire more” radio waves.
The latest auction, the first since 2016, will boost the treasury as the government tries to revive the economy after last year’s pandemic-induced recession. Ambani’s conglomerate is brimming with funding after receiving $ 27 billion last year from global investors, including Facebook Inc. and Google, as Ambani seeks to transform Reliance from an energy giant to a tech titan.
Unexpected surplus
Better-than-anticipated auction collection “is not only an unexpected surplus for the treasury, but also a very healthy indicator” of the value Indian wireless operators place on deepening 4G services and leveraging 5G potential, Utkarsh Sinha , Managing Director of Mumbai -based on Bexley Advisors.
Reliance Jio has acquired radio waves that are suitable for use with 5G technology, it said in a statement. It has also added spectrum in the 22 areas of the country.
Bharti, the second-largest telephony operator by customers, will only spend 186.99 billion rupees on radio waves, while Vodafone Idea Ltd., which has losses, said it gained spectrum in five areas of India.
Bharti and Vodafone Idea are trying to reduce debt and repair their balance sheets after Reliance Jio entered in 2016 with free calls and ultra-cheap data, sparking a rate war that reduced the sector from a dozen wireless carriers to just three carriers. from the private sector. Reliance Jio’s oldest rivals were also asked last year to shell out billions of dollars in dues passed on to the government.
Expired licenses
Reliance Jio acquired 488.35 megahertz of radio waves, dwarfing the 355.45 megahertz added by Bharti and the 11.8 megahertz from Vodafone’s local unit.
While telecom operators needed radio waves to replenish soon-expiring spectrum licenses and strengthen their networks, this year’s auction did not see the kind of intense competitive bidding seen in the last decade when there were many more players in the market. the sector.
Reliance Jio and Bharti are also preparing to roll out 5G networks in India and conserve some funding energy for that as well.
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