High Spectrum Costs Could Impact India’s Digital Goals, Says GSMA | Current Affairs | Vision IAS

Daily News Summary

Get concise and efficient summaries of key articles from prominent newspapers. Our daily news digest ensures quick reading and easy understanding, helping you stay informed about important events and developments without spending hours going through full articles. Perfect for focused and timely updates.

News Summary

Sun Mon Tue Wed Thu Fri Sat

High Spectrum Costs Could Impact India’s Digital Goals, Says GSMA

2 min read

Telcos in India and Spectrum Costs

The telecommunications sector in India faces a significant challenge due to high spectrum costs, which are among the highest worldwide. This situation may impact India's digital goals in the future, as highlighted by a recent report from London's GSMA.

Issues with Spectrum Pricing and Sales

  • High reserve prices have traditionally hindered spectrum sales in India, leading to: 
    • Unsold airwaves.
    • Contributing to spectrum scarcity.
  • Hefty airwave base prices have resulted in higher final prices in auctions.

Recommendations by GSMA

  • Governments and regulators should prioritize spectrum pricing that aligns with market realities to foster long-term digital growth.
  • Affordable spectrum can unlock: 
    • Faster network expansion.
    • Better service quality.
    • Greater digital inclusion for citizens.

Recent Trends and Impact

  • Recent lower unit prices in spectrum sales have not been sufficient to reverse the spectrum cost build-up trend.
  • Acquisition of new bands for 5G and 4G networks has increased the spectrum cost burden between 2015 and 2023.
  • Spectrum costs account for 26% of operator recurring revenues, ranking among the highest globally.

Global Comparisons and Financial Impacts

  • Globally, cumulative spectrum costs account for 7% of operator revenues, showing a 63% increase over the past decade.
  • The telecom industry's financial challenges are exacerbated by a 60% decline in average revenue per MHz of spectrum over the same period.
  • Tags :
  • Telecoms
Subscribe for Premium Features