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<\/span><\/figcaption><\/figure>NEW DELHI: With abolition of spectrum usage charge<\/a> (SUC<\/a>) on airwaves to be bought in the upcoming auction, telcos will get an effective cost reduction of 40-50% in their annual payment to the government, a senior government official said.

\"This is over and above the 39% reduction that Trai (Telecom Regulatory Authority of India) had recommended over the 2018 prices and this should give a relief to telcos,\" the official told ET, asking not to be named.

On April 11, Trai had recommended a reserve price of Rs 317 crore a unit for airwaves in the premium 3.3-3.67 GHz
5G<\/a> band (also known as C-band), a 36% reduction to its last recommendation in 2018. It had also cut the recommended price for the coveted 700 MHz spectrum by 40%, to Rs 3,297 crore a unit. On average, Trai cut prices across bands by around 39%.

But telcos had said the prices were still too high, especially when compared with global benchmarks, and asked for a 90% cut in the reserve price of airwaves from the 2018 levels.

But the official said that according to a back of the hand calculation, if a telco buys 100 Mhz of 5G spectrum (in the 3300 MHz band) for around Rs 32,000 crore and another 1Ghz in the millimeter wave (26GHz) band for Rs 8,000 crore, then the total price of spectrum bought becomes Rs 40,000 crore.

“At Net Present Value, the annual outgo for a telco on this spectrum would be Rs 3,300 but with zero SUC, the payment would perhaps reduce by as much as 50%,” the official said.

In a statement, Prashant Singhal, EY Global TMT emerging markets leader, termed the scrapping of the SUC as one of the key highlights of the 2022 spectrum auction NIA.

“SUC paid by operators currently varies between 3-5% of adjusted gross revenue (AGR) depending on the year of acquisition and the 0% SUC will be a welcome relief to operators and enable a faster 5G rollout,” said Singhal.

The Cabinet also permitted enterprises to directly take spectrum from the DoT for establishing their private captive networks. However, the DoT will first identify the chunks of bandwidth in certain bands and also evaluate demand for such airwaves, after which the telecom regulator will hold stakeholder consultations to decide whether to allocate or price the spectrum.

\"In<\/a><\/figure>

In a blow to telcos, Cabinet leaves 5G reserve price unchanged<\/a><\/h2>

The cabinet, meanwhile, approved the sale of 72,097.85 MHz of spectrum with a validity period of 20 years on Tuesday. The auction will be held for spectrum in various bands including 600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 3300 MHz and 26 GHz frequency bands.<\/p><\/div>

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<\/span><\/figcaption><\/figure>NEW DELHI: With abolition of spectrum usage charge<\/a> (SUC<\/a>) on airwaves to be bought in the upcoming auction, telcos will get an effective cost reduction of 40-50% in their annual payment to the government, a senior government official said.

\"This is over and above the 39% reduction that Trai (Telecom Regulatory Authority of India) had recommended over the 2018 prices and this should give a relief to telcos,\" the official told ET, asking not to be named.

On April 11, Trai had recommended a reserve price of Rs 317 crore a unit for airwaves in the premium 3.3-3.67 GHz
5G<\/a> band (also known as C-band), a 36% reduction to its last recommendation in 2018. It had also cut the recommended price for the coveted 700 MHz spectrum by 40%, to Rs 3,297 crore a unit. On average, Trai cut prices across bands by around 39%.

But telcos had said the prices were still too high, especially when compared with global benchmarks, and asked for a 90% cut in the reserve price of airwaves from the 2018 levels.

But the official said that according to a back of the hand calculation, if a telco buys 100 Mhz of 5G spectrum (in the 3300 MHz band) for around Rs 32,000 crore and another 1Ghz in the millimeter wave (26GHz) band for Rs 8,000 crore, then the total price of spectrum bought becomes Rs 40,000 crore.

“At Net Present Value, the annual outgo for a telco on this spectrum would be Rs 3,300 but with zero SUC, the payment would perhaps reduce by as much as 50%,” the official said.

In a statement, Prashant Singhal, EY Global TMT emerging markets leader, termed the scrapping of the SUC as one of the key highlights of the 2022 spectrum auction NIA.

“SUC paid by operators currently varies between 3-5% of adjusted gross revenue (AGR) depending on the year of acquisition and the 0% SUC will be a welcome relief to operators and enable a faster 5G rollout,” said Singhal.

The Cabinet also permitted enterprises to directly take spectrum from the DoT for establishing their private captive networks. However, the DoT will first identify the chunks of bandwidth in certain bands and also evaluate demand for such airwaves, after which the telecom regulator will hold stakeholder consultations to decide whether to allocate or price the spectrum.

\"In<\/a><\/figure>

In a blow to telcos, Cabinet leaves 5G reserve price unchanged<\/a><\/h2>

The cabinet, meanwhile, approved the sale of 72,097.85 MHz of spectrum with a validity period of 20 years on Tuesday. The auction will be held for spectrum in various bands including 600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 3300 MHz and 26 GHz frequency bands.<\/p><\/div>