Strategies of the 3 telcos on 5G bid

Reliance Jio is set to use 700 MHz for deploying its own 5G stack for its pan-India network, besides using 3.3 GHz band for expanding coverage of its new and existing network, as per industry insiders. “A low band rollout in rural areas requires 50% less sites than the mid-band, which means lower capex and opex, leading to overall cost reduction and a better business case,” said Rohan Dhamija. Managing Partner-Middle East and South Asia Region.

“Based on global benchmarks, an operator with 700 Mhz plus C band typically gets 3.5-5% higher market share than an operator which has C band alone,” he noted.

Experts added that Jio’s interest in the pricier band has made sure that there is no future base price reduction, which means that Bharti Airtel will also pick up this band in future auctions.

“We view this as a negative for Bharti as we believe this could result in Bharti having to add spectrum in sub-GHz bands in future auctions (and hence increase balance sheet leverage) to keep pace with Jio’s network quality,” analysts at Goldman Sachs said in a note.

However, Airtel said in a statement, it need not go for buying expensive sub-Ghz airwaves since it had accumulated the largest pool of low and mid band spectrum (Sub ghz/1800/2100/2300 bands) which can be used to provide the best 5G coverage while massive capacities in the 3.5 GHz and 26 GHz bands will allow Airtel to create 100X capacities at the least cost.

“This well thought out strategy for spectrum acquisition through auctions, M&A and trading has allowed Airtel to avoid the need to add an expensive sub GHz band,” it said.

Meanwhile, Vodafone Idea will leverage global experience of its promoter, the UK-based Vodafone Group, the company said in a statement. Vodafone Idea will continue to invest in our future ready network to upgrade it for roll out of 5G services, the company added. Livemint