No spectrum auction: Government after Elon Musk objects to Mukesh Ambani’s pitch

The government has decided to allocate satellite communication (satcom) spectrum administratively, opting against the auction route favoured by Indian billionaires Mukesh Ambani and Sunil Bharti Mittal.

The decision came after Starlink CEO Elon Musk objected to Ambani’s Reliance Jio lobbying for the auction route. Elon Musk, the world’s richest man, has been eyeing entering the Indian telecom sector with Starlink. He has been a vocal critic of the auction route, which has been preferred by Mukesh Ambani, Asia’s richest man.

Starlink, along with other global companies like Amazon’s Project Kuiper, supports the administrative allocation of spectrum, which is in line with global practices. Musk highlighted that the International Telecommunication Union (ITU), a UN agency of which India is a member, designates satellite spectrum as shared, and thus, it should not be auctioned.

Musk had openly questioned the demands for an auction in India. On Monday, Musk, in response to reports of Reliance Jio challenging the administrative allocation of spectrum, said that an auction would be “unprecedented”.

Replying to another X post on the spectrum issue on Tuesday, Musk appeared to take a dig at Ambani and said, “I will call and ask if it would not be too much trouble to allow Starlink to compete to provide internet services to the people of India.”

On the other hand, Ambani’s Reliance Jio has been pushing for the auction of satellite spectrum to ensure a “level playing field” for telecom operators. Reliance has argued that companies using satellite spectrum should undergo the same competitive bidding process as terrestrial services.

Reliance Jio recently wrote to the Telecom Regulatory Authority of India (TRAI), requesting a reevaluation of its consultation paper that favours administrative allocation. It urged the government to reconsider, insisting that an auction is the only way to ensure fair competition.

“We have requested (the) TRAI to amend the consultation paper” to ensure a level playing field, Reliance Jio said in a statement to Reuters on Sunday, adding that “it is imperative upon TRAI to also consult on the methodology of assignment” of spectrum.

Sunil Mittal, head of Bharti Airtel, also voiced support for an auction at a recent event, emphasising that satellite companies providing services to urban and retail markets should adhere to the same licencing rules as telecom operators. “They need to buy the spectrum as the telecom companies do,” Mittal said, underscoring the need for a uniform policy across the sector.

However, Telecom Minister Jyotiraditya Scindia announced that India will follow the global trend of administrative spectrum allocation. “Satellite spectrum across the world is allocated administratively. So, India is not doing anything different from the rest of the world,” he said.

Scindia assured that while the allocation would be administrative, the cost would be determined by TRAI, ensuring fairness. “The regulatory authority of telecom has been empowered by the constitution to decide what that administrative pricing is going to be,” Scindia added.

The satellite broadband market in India is expected to grow rapidly, with estimates suggesting it could reach USD 1.9 billion by 2030.