Amazon’s Kuiper, Tata, Bharti Airtel-backed OneWeb, and Larsen & Toubro are against the auction while Reliance Jio and Vodafone-Idea support an India SS auction
Elon Musk’s Starlink wants to beam wireless internet to India from satellites in orbit, but the licencing structure he prefers has placed him at conflict with Mukesh Ambani’s Reliance.
Musk stated on June 21 that after meeting Prime Minister Narendra Modi in New York last week, he was eager to launch Starlink in India, which “can be incredibly helpful” in supplying internet to rural communities that lack on-ground infrastructure.
However, Starlink wants India to simply issue a licence for the service rather than auctioning off the signal-carrying spectrum or airwaves. This stance puts Musk on the same side as Tatas, Sunil Bharti Mittal’s company, and Amazon, both of which choose the same path. However, Ambani’s Reliance maintains there must be a spectrum auction for foreign satellite service providers to offer voice and data services on a level playing field with traditional telecom operators who offer the same services using airwaves purchased in government auctions.
“India’s space-based communication services (SS) spectrum decision is key. Mobile spectrum has been auctioned since 2010 with the government’s cumulative sale of $77 billion and several players are keen on SS,” brokerage CLSA said in a note on ‘Satellite Spectrum Battle Ahead’.
Based on comments provided by various companies to the sector regulator TRAI’s consultations on the issue, CLSA said several players, including Starlink are keen on India SS.
Amazon’s Kuiper, Tata, Bharti Airtel-backed OneWeb, and Larsen & Toubro are against the auction while Reliance Jio and Vodafone-Idea support an India SS auction, it said.
According to government sources, an auction is the greatest option because it would encourage foreign corporations to invest in the country. It will also offer some control over the content that can be transmitted on OTT services employing the SS.
To maintain interference-free SS, the ITU oversees spectrum, satellite orbit resources, and organises the planning of future satellite networks on a worldwide scale.
The International Telecommunication Union organises orbit slots and frequency bands, although India will allocate spectrum to licensees for gateway links to satellites and user links (terminal and satellite).
Internationally, spectrum for SS and orbital slots was auctioned in significant markets like as the United States and Brazil, although both were later administratively assigned.
The public consultation on satellite spectrum received 64 replies from enterprises, industry groups, and individuals, with 48 in favour of licencing, 12 in favour of an auction, and the remainder indifferent.
According to CLSA, OneWeb believes that SS should be assigned administratively, on a shared basis, and harmonised globally. Musk’s SpaceX, which is authorised in 84 administrations (1.5 million customers) via Starlink, believes that the optimum approach for SS spectrum is a shared model with administrative assignment.
Amazon’s Kuiper project, which expects to launch its first set of satellites in 2024, advises administrative assignment and also states that spectrum-sharing requirements will be imposed after that auctions would create inefficiencies.
According to Reliance Jio (RJio), India’s market leader with around 440 million telecom customers and 8 million wired broadband connections, satellite operators are constructing networks to compete with terrestrial service providers, with auctioning SS being the only realistic method.
Vodafone-Idea has also requested the auction regulator to maintain an equal playing field.
Bharti Airtel feels that auctioning SS spectrum will create barriers to competition since some may gain access while having no global allocation.
Reliance Jio and Bharti are currently launching 5G services in India. When combined with existing 5G coverage, SS will extend the capabilities of 5G networks to areas where cell coverage is not projected to reach, as well as enhance workplace productivity, CLSA said.
“However, in India, low mobile 5G tariffs of $0.17 per GB (vs $6 in the US and $0.4 in China) will be a challenge for providing SS,” it stated. “SS spectrum allocation through auction or administrative allotment will also be critical to telecom’s competitive landscape, including in 5G and access to underserved populations.”
According to Deloitte, India’s satellite broadband service industry will expand by 36% per year to $1.9 billion by 2030.