5G reserve price is just too high for telecom companies, say experts

The debt-ridden telcos have not shown much interest in the auctions: Bharti Airtel called the prices exorbitant while Vodafone Idea wants the auctions take place in 2020

As India readies for its ambitious 5G spectrum auctions, at the current base price, (which the industry finds overly expensive), analysts point out that the internal rate of return (IRR) on incremental investment will be as low as 7 per cent for the telcos. 

Last week, the Digital Communications Commission (DCC) sought a review of the telecom regulator’s recommendations on the upcoming spectrum auctions, especially on the reserve prices. This has been done to ensure competition during the spectrum auctions as well as to avoid having unsold spectrum, as in the previous auctions when only 40 per cent of the