[ TECH ] 5G Price " Exorbitant " at $7 Billion per 100 MHz!

Dinesh Vishwakarma

[p]Brokerage firm CLSA in its recent study said that the price of 5G spectrum is $ 7 billion per 100 MHz in India which is too high and nearly four times of that in Korea, reported by Business Line.[br]

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[p]Brokerage firm CLSA in its recent study said that the price of 5G spectrum is $ 7 billion per 100 MHz in India which is too high and nearly four times of that in Korea, reported by Business Line.

[p]The exorbitant price will drag on companies Internal Rate of Return, CLSA said, adding that only significantly lower prices will justify above cost IRR and spectrum.

[p]This $7 billion cost will be paid by the telecom operators individually for 80-100 MHz spectrum out of the total of 275 MHz of spectrum.

[p]The deal will not be profitable to the operators as the incremental investment IRR will be 7 per cent, whereas the report said that 33 percent lower spectrum cost can boost 5G IRR to 13 per cent.

[p]TRAI has recommended sales of 275 MHz of spectrum in 3.3-3.6 GHz band at Rs 490 crore per MHz.

[p]The supply of spectrum will be enough as there are only three operators in the market, said by the report.

"So if Reliance Jio Infocomm bids in current auctions, it is expected that Bharti Airtel could purchase spectrum in subsequent auctions which will likely also lead to a cut in the price of spectrum," CLSA said.

[p]However, the Telecom Ministry has said that 5G trials are likely to begin by September and spectrum may be auctioned by the end of 2019.

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[h4][a href="https://telecom.economictimes.indiatimes.com/news/5g-price-exorbitant-at-7-b-per-100-mhz-report/69701114" target="_blank"]Source[/a][/h4]

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