Jio has some essential shopping to do soon

KOLKATA: The upcoming 4G spectrum auctions are more critical for Reliance Jio Infocomm than for its nearest rivals, Airtel and Vodafone Idea. That’s since a sizeable chunk of Reliance Communications’ 4G airwaves in the coveted 800 MegaHertz band — that the Mukesh Ambani-led telco uses under a sharing pact — will expire in 18 circles in July-August 2021, analysts said.They added that Airtel and Vodafone Idea will also need to buy back their expiring airwaves in eight circles each, but mostly in the less expensive 1800 MHz band, also used for 4G.Such a scenario leaves Jio facing a similar situation that Bharti Airtel, erstwhile Vodafone India and Idea Cellular (now merged into Vodafone Idea) had found themselves in during the February 2014 and March 2015 auctions when they had to buy back their own expiring spectrum in the 900 MHz band in several circles at exorbitant rates, or else risked losing the mobility business, a development that has contributed to their current high debt levels and financial stress. 71432679 “RCom’s 800 MHz spectrum has played a critical role in Jio’s pan-India 4G launch, and the scenario for Jio is similar to what the incumbents faced when their 900 MHz spectrum came up for renewal around four-five years ago”, Rajiv Sharma, co-head of research at SBICap Securities, said.He added that an early auction will help Jio regain these crucial airwaves to ensure business continuity and maintain quality of its countrywide 4G coverage, especially as the ecosystem for other sub-GigaHertz bands such as 700 MHz is not developed, besides their exorbitant pricing that makes them unfeasible to buy in an auction.Jio uses bankrupt RCom’s 800 MHz spectrum through a 21-circle spectrum-sharing pact to deliver countrywide 4G coverage. But those airwaves in 17 circles will expire in July 2021, and in one in August 2021, a person aware told ET. So, nearly 49 units of 800 MHz across these 18 circles will expire, and around 59 MHz of such spectrum will be up for sale in the next auction, as per the regulator’s recommendations.At press time, Jio, RCom, Airtel and VIL didn’t reply to queries.

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