Why unsold 700 MHz spectrum will pinch consumers

Not a single telecom firm bid for 700 MHz spectrum

GN Bureau | October 7, 2016


#Mobile Phone Connectivity   #Telecom   #Spectrum   #3G  
Not a single telecom firm bid for 700 MHz spectrum
Illustration: Ashish Asthana

Your mobile phone coverage would not have been patchy and you would have faced much fewer problems regarding mobile phone connectivity if the 700 MHz had been picked up by the telecom operators. But, that didn’t happen.

The government has described India’s largest spectrum sale which ended on Thursday as a success, with Rs65,789.12 crore being raised in revenue. The consumer, however, would have been better off if the lower end of the spectrum had been sold. It would have essentially put an end to mobile phone users desperately looking for better coverage areas so that they can carry on an unhindered conversation.

Read the COAI proposal for 700 MHz

The 700 MHz band is highly desired thanks to its electromagnetic properties. The frequencies in the band, between 698 and 806 MHz, travel farther and pass through walls and other obstacles much better than existing cell phone networks do, leading to a lower required number of cells to provide the same amount of coverage. In addition, because of the lower frequency, it would require less power to run a mobile phone/Internet cell on the 700 MHz band than on the other common bands, which are at higher frequencies, explains a survey paper.

For the industry, the band effectively cuts down capital expenditure involved in the process of erecting towers. The cost of delivering mobile services in the 700 MHz band is around 70 percent cheaper than in the 2,100 MHz band used for 3G services.

The steep price of 700 MHz proved to be a deterrent. It had a reserve or base price of Rs 11,485 crore per Mhz.

“May be the operators are not ready...it is not that the 700MHz is running away. If it was not sold this time, it will be sold next time. We will sell it. Despite 700 MHz remaining unsold, we are happy that the upfront payment we will get is the highest ever, in the last five years,” Communications minister Manoj Sinha told Hindu Business Line

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