Amid Musk-Ambani row, India eyes satellite spectrum to attract global firms

Rimjhim Singh New Delhi Jan 21 2025.business-standard

India’s decision to allocate satellite spectrum instead of auctioning it will offer consumers greater choices, according to  Union Minister of Communications Jyotiraditya Scindia, who downplayed concerns raised by Mukesh Ambani’s Reliance Jio. The company had feared being outpaced by Elon Musk's Starlink.

Starlink, which has long sought entry into India, has had a dispute with Ambani’s company over the spectrum allocation process. Reliance had called for an auction, but the government opted for an administrative allocation, supporting Musk’s preference and aligning with global trends. Analysts believe that an auction, which would require higher investments, could potentially discourage foreign competitors. 

 

 

Ambani voiced his concerns about a fair playing field, worried that Reliance, which invested $19 billion in spectrum auctions, might lose broadband customers to Starlink, and potentially even voice and data clients in the future as technology evolves.

 

Expanding connectivity options

 

“My job as telecoms minister is to make sure that you have as many choices as possible,” said Scindia in an interview with news agency Reuters at his ministry’s office in New Delhi.

When asked about Reliance’s concerns, Scindia, without naming any specific company, said, ‘Technology is never constant’, emphasising that companies must continuously evolve to stay competitive. 

Scindia pointed out that current satellite communication technology requires devices to have a clear view of the sky, meaning smartphones cannot access the technology indoors, unlike terrestrial networks. “The minute you come into this building, you’re done,” he remarked. 

Indian telecom industry

 

India is a major telecom market with 942 million users, and competition is fierce between Reliance and rivals Bharti Airtel and Vodafone Idea. Data prices are among the lowest globally, and internet connectivity is growing rapidly.

Deloitte forecasts India’s satellite broadband market will be valued at $1.9 billion by 2030, making it an attractive market for players like Starlink, Amazon, and Ambani. Scindia also mentioned that Starlink and Amazon Kuiper’s applications for satellite broadband licences are still under review.

Musk has a history of disrupting markets. For instance, in Kenya, he priced Starlink at $10 per month, compared to $120 in the US, drawing complaints from Kenya’s Safaricom.

Govt stake in Vodafone Idea

 

A former aviation minister, Scindia is also overseeing multiple telecom projects for Prime Minister Narendra Modi. The Indian government holds a stake in Vodafone Idea, and the company reported $24 billion in dues to the government as of November.

Additionally, the government is working to revive Bharat Sanchar Nigam Ltd (BSNL), which has lost market share amid intense competition, by expanding its 4G offerings. BSNL currently has 99 million users.

[With agency inputs]⍐