Sunday, 11 April 2021

Auctioned spectrum not enough for Jio who buys blocks from Airtel

by Harry Baldock, Total Telecom
Tuesday 06 April 21

Reliance Jio has struck an agreement with Bharti Airtel to purchase the ‘Rights of Us’ for its 800MHz spectrum in the Andhra Pradesh, Delhi, and Mumbai circles

Last month saw the Indian government complete its latest 4G spectrum auction, in which Mukesh Ambani’s Reliance Jio took home the lion’s share of the licences, spending around $8 billion on 488.35MHz of spectrum. It seems that this acquisition was not enough…

Last month saw the Indian government complete its latest 4G spectrum auction, in which Mukesh Ambani’s Reliance Jio took home the lion’s share of the licences, spending around $8 billion on 488.35MHz of spectrum.

It seems that this acquisition was not enough, however, with Jio announcing that it has signed a deal with rival Bharti Airtel to acquire the latter’s rights of use in the 800MHz band in three circles: Andhra Pradesh, Delhi, and Mumbai. Airtel will transfer Jio the rights for 2x15MHz of 800MHz in the Mumbai circle, and 2x10MHz of 800MHz in both the Andhra Pradesh and Delhi circles.

In total, the deal is worth around 1,497 crore rupees (around $204 million), around two thirds of which will be transferred directly to Airtel, with the last third representing future liabilities related to the spectrum which Jio will assume.

The move appears to be a win-win for both operators. For Airtel, the sale allows them to do away with largely unused spectrum, which they received as part of their acquisition of Tata Teleservices last year. Airtel will reportedly use the funds raised for network expansion. 

Meanwhile, for Jio, the additional spectrum will help to consolidate their spectrum footprint in these key regions.

"With the enhanced spectrum footprint, especially contiguous spectrum, and superior infrastructure deployed, RJIL has further increased its network capacity," said Jio in a statement.

The agreement, as always when dealing with matters of spectrum, is subject to regulatory approval. 

 

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