Airtel and Jio trade spectrum
06 April 2021 | Capacity Team
Indian MNOs Bharti Airtel and Reliance Jio Infocomm have entered into an agreement to trade spectrum.
A notice issued on Tuesday confirmed the right of use for Airtel’s 800 MHz spectrum in Andhra Pradesh (3.75 MHz), Delhi (1.25 MHz) and Mumbai (2.50 MHz) will be sold to Jio.
The transaction will see Jio hold 2X15MHz of spectrum in the 800MHz band in Mumbai circle and 2X10MHz of spectrum in the 800MHz band in Andhra Pradesh and Delhi circles, "further consolidating its spectrum footprint in these circles". The operator commented: "With the enhanced spectrum footprint, especially contiguous spectrum, and superior infrastructure deployed, RJIL has further increased its network capacity."
Airtel will receive Rs 1037.6 crores from Jio for the proposed transfer. In addition, Jio will assume future liabilities of Rs 459 crores relating to the spectrum.
Gopal Vittal, MD & CEO, Bharti Airtel said: “The sale of the 800 MHz blocks in these three circles has enabled us to unlock value from spectrum that was unutilised. This is aligned to our overall network strategy.”
In the country's most recent auction – it's first since 2016 – Jio spent $7.8 billion, followed by Bharti Airtel Ltd., which spent $2.6 billion.
The auction got underway on 1 March local time, following months of delays and, conducted over four rounds, a total 2,251 MHz of spectrum was made available.
With a reserve price of Rs 3.92 lakh crore, the auction included seven bands: 700, 800, 900, 1,800, 2,100, 2,300, and 2,500 MHz. All spectrum sold was valid for 20 years, however, as much as 63% of the total spectrum on offer went unsold, while the 700 MHz band received no bids.
In the auction, Bharti Airtel took 355.45MHz, while Reliance Jio – which has been particularly vocal about its 5G launch plans – acquired the largest haul at 488.35 megahertz. Vi took 11.8MHz. The spectrum is expected to be used to replace expiring licenses, strengthen networks, and begin early 5G roll outs.
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