700 MHz band
There was no bid for the 700 MHz band. This band is considered to be the best for 4G deployment. There’s a kind of consensus in the industry that 700 MHz would be the best spectrum for 4G deployment as it has been deployed in various other countries. The spectrum is expected to provide great coverage and indoor penetration. 700 MHz spectrum also has a robust ecosystem internationally both on the vendor side as well as on end consumer devices. However, as I had initially described in this article, the reserve price for 700 MHz spectrum was simply too steep and didn’t make business sense for any operator to buy it. As expected, none of the operators bought any spectrum in the 700 MHz band. This will be a huge disappointment to the government as the 700 MHz band was the real cash cow. As much as 80% value of the spectrum put up for sale was locked in this band. My guess is that the government will now have to reduce the pricing and put it up for auction again. But by how much? That remains to be seen. My biggest fear over here is that in addition to cutting down the price of 700MHz spectrum, the government might also reduce the quantity to just 10-15 MHz so that operators will have to battle it out against each other in the next auction and more revenue will be generated for the government. But it’s totally possible that the government decides to lower the price and keep the quantity same in the next auction.
850 MHz band
There has been only one bidder for the 850 MHz spectrum and that’s been Reliance Jio. Jio had been gathering a lot of 850 MHz spectrum even before this auction had started and has only beefed it even more now. Jio has acquired 5 MHz 850 MHZ spectrum in Gujarat and Rajasthan. Apart from these 2 circles, Jio has gained 3.75 MHz in Punjab and 1.25 MHz in U.P.East as well. Considering the fact that no one had bid for the 700 MHz spectrum and 850 MHz spectrum was only taken up by Jio, the Mukesh Ambani-owned telco becomes the only operator in India to have sub 1 GHz spectrum on a nationwide basis. This is a very critical advantage for Jio as it will help them to offer great coverage and in-building penetration. Unless any operator has spectrum in the <1 GHz range, providing great coverage and in-building penetration is a huge challenge. Now the next auction is at least quite a few months away, I would say at least a year away. Telecom chairman R.S Sharma had said that the next auction will be after quite some time and that the operators should “tank-up” their spectrum holdings. Now, in my opinion, the next auction would be during October 2017 or might even extend until March 2018. Meanwhile, Jio is already deploying 850 MHz spectrum on a nationwide basis. Even if let’s say an auction is held in October 2017 and operators win 700 MHz spectrum in that auction, it wouldn’t be until the end of 2018 that the 700 MHz spectrum would start seeing proper deployment.
Real life performance
Many people would want to point out that Jio’s real life performance has gone down drastically ever since the commercial launch took place and I tend to agree on that. I’m myself not able to load things as simple as Twitter GIFs or Instagram Stories on Jio while Speed Test shows record speeds. But I don’t think the problem is with Jio’s spectrum holdings. Jio’s spectrum holdings are pretty spacious and have become even more spacious with this auction. I think the problem lies somewhere in Jio’s internet backbone, now what exactly is causing that problem, even I don’t know but it’s definitely not their spectrum holdings.
I think some of it might be down to congestion. Even in countries like US and Europe where certain operators provide unlimited data, the average data consumption on their network is just 2-3GB/month. In US and Europe, their broadband infrastructure is very well developed. Most households have access to decent quality broadband with speeds of 25 Mbps and 1 Gbps in most cases with no or extra generous data usage caps. Over here in India, our broadband infrastructure is very poor. Most people are on 2-5 Mbps connections and have 512 kbps/1 Mbps kick in once we exceed the FUP and the FUP isn’t very large by the way. I am guessing a lot of people are using Jio as a replacement for their home broadband connections as of now. Also with a cap of 4GB/day, it translates into a cap of 120 GB/month which makes it ideal for a home broadband connection. Mukesh Ambani had himself said that average usage on Jio’s network was close to 23 GB/month/user. There’s definitely a lot of load on the network considering that subscribers are being on-boarded at a rate of 0.5 million – 1 million/day. Once the free period ends on 31st December 2016, the load should drastically come down and network performance should improve a lot. I still think the edge is with Jio. If there’s a problem with the backbone, Jio can hire more engineers or lease more submarine capacity or do something to fix it in the coming months. By comparison, the spectrum is something that only the government can allot and the next auction is a year away. If Jio wants, they can solve their speed problems almost overnight but operators that want sub 1 GHz spectrum need to wait for at least one year and spend yet another year to build it out.
900 MHz band
The 900 MHz band also didn’t see any bids. I think operators have already purchased all the 900 MHz spectrum they wanted in the 2014 and 2015 auctions. No circle in this auction had more than 5 MHz of 900 MHz spectrum available. Bihar was closest with 4.6 MHz, but Bihar’s top operator – which is Airtel – had already purchased a lot of 900 MHz spectrum in the last auction by snatching away Rcom’s 900 MHz spectrum. Apart from Bihar, the other three circles where 900 MHz was being auctioned had less than 4 MHz of the spectrum which means even 3G deployment wouldn’t have been possible on them. I really think there’s no more scope for 900 MHz spectrum and action in this band will be regenerated only when operators such as Aircel have their 900 MHz spectrum come up for renewal in the years to come.
1800 Mhz band
The 1800 MHz like the past two auctions has once again seen intense bidding. I’m presuming some of this bidding is for making sure that operators that are having their licenses close to expiry have something to fall on while the other is for FD-LTE coverage. 1800 MHz band is the best combination of capacity and coverage. Also, 1800 MHz has the best possible ecosystem for LTE. Literally, every 4G smartphone on earth supports 1800 MHz band for LTE. It’s no wonder that almost all operators in India that have deployed LTE have at least some variant of FD-LTE present in India. As for this auction, I’ll have to discuss 1800 MHz spectrum on an operator by operator basis as almost all the participants barring Rcom have bid for it.
Reliance Jio
Now of course, if Jio has bid for 1800 MHz spectrum then it’s mostly for LTE deployment only. Jio’s spectrum bidding in the 1800 MHz band is detailed below – Spectrum won in auction:
5 MHz in Bihar 1 MHz in Haryana 5 MHz in Himachal Pradesh 10 MHz in Jammu and Kashmir 3.4 MHz in U.P East 5 MHz in U.P West 5 MHz in West Bengal
What Jio has basically done is make sure that they have more than 5 MHz of 1800 MHz spectrum on a nationwide basis and they have achieved the same with this auction. Except for Punjab, Jio now has more than 5 MHz of 1800 Mhz spectrum all over India. This now acts as a secondary layer over Jio’s already present pan-India 2300 MHz spectrum. Wherever Jio had gaps in its 1800 MHz portfolio, those gaps have now been filled in the latest auction except for Punjab.
Airtel
Airtel has added very little 1800 MHz spectrum to its kitty. I guess Airtel had already bought most of the 1800 MHz spectrum in the 2014 and 2015 auctions itself. In this auction, Airtel just used it to top up its 1800 MHz holdings as below.
Haryana – 1.6 MHz North East – 1.4 MHz Punjab – 0.8 MHz Rajasthan – 1.8 MHz Kolkata – 2.0 MHz Jammu and Kashmir – 2.4 MHz Maharashtra – 5.0 MHz Assam – 3.8 MHz Kerala – 5.0 Mhz
Airtel has 6.2 MHz of non-liberalized spectrum in Haryana, so unless and until Airtel decides to liberalize that, there’s no way FD-LTE can be done with 1.6 MHz of spectrum it recently acquired. Alternately, Airtel could just add 1.6 MHz spectrum to its existing 2G network and improve its capacity. It’s crucial to note that Airtel has no 900 Mhz spectrum in Haryana, so my bet is that the recently acquired spectrum will mostly be used to improve its 2G network. Again, Airtel has just 1.8 MHz spectrum in North East which is also non-liberalized. If the entire 1.8 MHz is liberalized and added with the recently acquired 1.4 MHz spectrum, then Airtel can deploy narrow band LTE in North East considering they have a lot of 900 Mhz spectrum for 2G. The 1800 MHz spectrum won in Punjab, Kolkata, Rajasthan, and Kerala will be used to augment already present LTE networks operating on 1800 MHz. Airtel has quite a lot of 900 MHz spectrum in these circles for 2G barring Kerala. The 1800 MHz spectrum acquired in Jammu and Kashmir, Maharashtra and Assam will be used to launch brand new FD-LTE networks based on 1800 MHz band.
Vodafone
Assam – 7.8 MHz Delhi – 1.8 MHz Gujarat – 2.8 MHz Kerala – 0.6 MHz Kolkata – 2.0 MHz Punjab – 2.8 MHz Rajasthan – 4.0 MHz U.P East – 1.8 MHz U.P West – 2.2 MHz West Bengal – 7.4 Mhz
I think Vodafone has bought 1800 MHz spectrum very carefully in all of its top circles. Vodafone has already launched 4G in Gujarat, Haryana, U.P East and West, West Bengal, Delhi, Kolkata, Mumbai, Karnataka, and Kerala. So to be honest, out of the 10 circles where Vodafone has bought 1800 MHz spectrum, spectrum has been bought in 7 circles just to augment already existing LTE networks The places where there is a chance of brand new FD-LTE networks are Rajasthan and Assam. The 4 MHz acquired in Rajasthan can be combined with the already existing 0.8 MHz to create an LTE network of 4.8 MHz as 900 MHz is present for 2G. Assam single-handedly has 7.8 MHz which is more than enough to launch an FD-LTE network.
Idea
Assam – 5.8 MHz Bihar – 5.8 MHz Gujarat – 8.2 MHz Haryana – 4.6 MHz Himachal Pradesh – 0.6 MHz Jammu and Kashmir – 4.8 MHz Madhya Pradesh – 4.4 MHz Maharashtra – 1.8 MHz Rajasthan – 4.8 MHz U.P West – 7.0 MHz West Bengal – 4.8 MHz
Except for Himachal Pradesh and Maharashtra, Idea has bid more than 4.4 MHz spectrum in every single circle. The carrier seems fully prepared to launch 4G in a lot more circles than before. Idea seems all set to launch 4G from the ground up in Assam, Bihar, Gujarat, Jammu and Kashmir, Rajasthan, U.P West and West Bengal.
Tata and Aircel
Tata and Aircel have selectively bid for spectrum in the 1800 MHz band. Tata has bid for 2.2 MHz in Andhra Pradesh, 4.8 MHz in Maharashtra and 4.8 MHz in Mumbai. Aircel has bid for 1.6 MHz in Bihar. Tata now has the option to combine the recently acquired 2.2 MHz with already present 2.6 MHz spectrum and launch a FD-LTE network in Andhra Pradesh, 4.8 MHz acquired in Mumbai and Maharashtra can also be used to deploy LTE but whether Tata will choose to do so remains to be seen. Aircel has just augmented its 2G network in Bihar and nothing else.
2100 MHz
2100 Mhz has been traditionally used for 3G. During this auction, most operators have plugged their 3G gaps and have even doubled their 3G spectrum in a lot of circles. I luckily live in Tamil Nadu where Airtel in the 2015 spectrum auction itself had added 5 MHz of 2100 MHz spectrum taking its total holding to 10 MHz. A doubling of spectrum quantity in case of 2100 MHz spectrum had tremendously increased speeds and coverage and I have witnessed the same first hand. Luckily, with this spectrum auction, more operators other than Airtel and in more circles other than Tamil Nadu now have 10 MHz of 2100 MHz spectrum. If your operator has 10 MHz of 2100 MHz spectrum, then expect a significant uptick in terms of speed and coverage. 10 MHz 2100 Mhz spectrum Airtel –
Delhi Tamil Nadu Rajasthan Bihar Jammu and Kashmir
Vodafone –
Maharashtra Tamil Nadu (15 Mhz) Haryana Rajasthan U.P East
Idea –
Uttar Pradesh East
4G angle
I have a feeling that the 5 MHz of 2100 MHz spectrum purchased in this auction can be used for 4G. What baffles me is why Vodafone decided to buy as much as 10 MHz of 2100 MHz spectrum in Tamil Nadu in this auction when it already had bought 5 MHz 2100 MHz spectrum in 2010. Vodafone’s total spectrum holding for this band now stands at 15 MHz for TN circle. I am not sure if all the 15 MHz would be deployed for 3G. I feel that 5 MHz/10 MHz of 2100 MHz can be deployed for 4G. If 2100 MHz is indeed deployed for 4G then this will be something very interesting to look out for. I know many people would argue that 4G ecosystem in 2100 MHz band is very weak to nonexistent, but the operators have also bid for 2500 MHz spectrum in this auction which again doesn’t have a great ecosystem. I am not too confident about 2100 MHz being used for 4G but it’s a possibility nonetheless.
2300 MHz band
After 2010, this is the only other auction where 2300 MHz spectrum was auctioned. The story of 2300 MHz spectrum is also pretty unique. When in 2010, Jio had acquired Infotel broadband that had secured pan-India 2300 MHz spectrum, then several industry players had criticized the move saying that the ecosystem for 2300 MHz spectrum is very poor. Idea, in particular, had signalled ecosystem as a reason to not choose 2300 MHz band. While the ecosystem was indeed very poor at the beginning, it gradually improved as time passed since even China was using the same band for its LTE deployment and that was on a scale of its own. Although ecosystem was a problem in 2010, it’s safe to say that by 2016, every single 4G smartphone sold in India supported 2300 MHz band for LTE. It’s little wonder then that all the 2300 MHz band put up for sale was sold in the auction. Two blocks of 2300 MHz spectrum was put up for auction in every circle except for Haryana, Punjab, Rajasthan, UP. East and West. Most of the 2300 MHz spectrum was bought by Jio and Airtel. Jio, in particular, has repeated what they did in 2010, Just like how they bought 2300 MHz spectrum in every circle where it was available in 2010, even in 2016, Jio has bought 2300 MHz spectrum in every circle where it was available. This means Jio now has 30 MHz of 2300 MHz spectrum in all circles except for Haryana, Punjab, Rajasthan, U.P East and West. Already with just 20 MHz of 2300 MHz spectrum, I have seen certain people report speeds between 60-80 Mbps. I believe that once Jio deploys 30 MHz of 2300 MHz spectrum and if the BTS has fibre backhaul and less congestion, getting speeds above 100 Mbps might become a reality. Airtel, just like Jio, has managed to increase its spectrum holding in the 2300 MHz band to 30 MHz in quite a few circles. Most importantly, Airtel has managed to increase its 2300 MHz spectrum holding in all the metro markets to 30 MHz, which will help deliver great speeds. The circles where Airtel has 30 MHz of 2300 MHz spectrum are –
Delhi Mumbai Kolkata Andhra Pradesh Karnataka Tamil Nadu West Bengal Assam Odisha Bihar North East
Apart from the above-mentioned circles, Airtel has also bought 10 MHz spectrum in circles where they didn’t have any 2300 MHz spectrum. Those circles are Himachal Pradesh and Gujarat. My bet is that Airtel would now want to acquire Tikona’s 2300 MHz spectrum so that they can have pan India 2300 Mhz spectrum and even increase their holdings to 30 MHz in Himachal Pradesh and Gujarat. Jio and Airtel have bought the vast majority of 2300 MHz spectrum that was put up for sale. Idea, however, managed to get 10 MHz of 2300 Mhz spectrum in three of its top circles namely Maharashtra, Kerala and Madhya Pradesh. All three are some of Idea’s highest revenue generating circles and they must have bought 2300 MHz spectrum in these circles to improve capacity and bolster speed as 1800 MHz alone must not be cutting it.
2500 MHz band
I honestly thought there would be no bids in the 2500 MHz band but to my surprise, this band has seen quite some bidding. Vodafone has decided to entirely skip the 2300 MHz band and bid for 2500 MHz band instead. Idea has also bid for 2500 MHz band in quite a few circles. The circles where Vodafone and Idea have won 2500 MHz band is listed below – Vodafone
Delhi (20 MHz) Mumbai (20 MHz) Kolkata (20 MHz) Gujarat (20 MHz) Maharashtra (20 MHz) Haryana (10 MHz) Kerala (10 MHz) Punjab (10 MHz) Rajasthan (10 MHz) U.P East (10 MHz) U.P West (10 MHz) West Bengal (10 MHz) Assam (10 MHz) North East (10 MHz) Odisha (10 MHz)
Idea
Andhra Pradesh (10 MHz) Gujarat (10 MHz) Maharashtra (10 MHz) Haryana (10 MHz) Kerala (10 MHz) Madhya Pradesh (20 MHz) Rajasthan (10 MHz) U.P East (10 MHz) U.P West (10 MHz) West Bengal (10 MHz) Assam (10 MHz) Bihar (10 MHz) Himachal Pradesh (10 MHz) Jammu & Kashmir (10 MHz) North East (10 MHz) Odisha (10 MHz)
As can be seen, both Idea and Vodafone have bought quite some spectrum in the 2500 MHz band. Now I don’t know what the strategy is but this band is known to provide horrible coverage. Apart from that, the ecosystem for 2500 MHz band is very low. I think Idea and Vodafone are now realizing the mistake of having passed 2300 MHz spectrum in 2010 and have rather decided to go with 2500 MHz because Jio and Airtel that already have networks deployed on 2300 MHz band decided to grab all available spectrum in this auction. It’s important to remember here that Idea was the same operator that decided to skip 2300 MHz band citing ecosystem issues and has now bid for 2500 MHz band. The irony is beyond me. Unless and until Idea and Vodafone decide to deploy 2500 MHz on a lot of BTS, coverage of this band will be very weak. I can almost guarantee you that you’ll lose signal in places like lifts, cinema theatres etc. The silver lining over here is the 1800 MHz band that can act as a backup, but 2500 MHz just doesn’t seem the right band to me. What’s even more interesting is that Idea has decided to bid for 2300 as well as 2500 MHz spectrum in Maharashtra, Kerala, and Madhya Pradesh, this was totally unnecessary and Idea should have either stuck to 2500 MHz or 2300 MHz instead of having a mixture of both of them. Network management will be made unnecessarily complex.
Conclusion
I think it’s safe to say that as of now Jio has the best 4G spectrum portfolio. The operator has low band (850 MHz), mid band (1800 MHz) and high band (2300 MHz) on a pan India basis except for Punjab. This is a great spectrum portfolio and should make network management a lot better and easier. After Jio, I guess even Airtel has a pretty nailed down spectrum portfolio except for the lack of low band spectrum. Idea and Vodafone meanwhile seem to have screwed up a little and their spectrum portfolio doesn’t seem really attractive to me. Whatever be the case, this spectrum auction is going to shape the 4G networks in India for the next 2-3 years.
