While Sri Lanka’s Rs. 10 billion 5G spectrum auction has been hailed as a regulatory success, the outcome has also sparked discussion about competition and investment appetite in the telecom sector. With only two operators Dialog Axiata and SLT-Mobitel participating, the auction underscored both the strengths and constraints of the local market.
Regulators emphasise that the process followed international best practice, allocating spectrum in the critical 3.5 GHz and 27 GHz bands through a transparent clock-auction framework. However, the absence of additional bidders reflects high capital requirements, existing market consolidation and the long payback periods associated with 5G investments.
Industry analysts note that operators now face the challenge of translating spectrum ownership into commercial success. Rolling out 5G networks will require substantial spending on infrastructure, fibre backhaul and compatible devices, even as consumer affordability remains a key concern.
The Government is betting that clear rules on infrastructure sharing and policy certainty will help mitigate these challenges, enabling faster deployment and broader coverage. Whether the limited bidding signals caution or simply market maturity will become clearer as operators move from licences to live services.
Sri Lanka has taken a decisive step toward next-generation connectivity after the Government raised around Rs. 10 billion through its first commercial 5G spectrum auction, clearing the path for the launch of advanced mobile services. Dialog Axiata PLC and SLT-Mobitel, a subsidiary of Sri Lanka Telecom PLC, emerged as the sole bidders, securing long-term licences in a process officials describe as a milestone for the country’s digital economy.
The spectrum licences were formally awarded at a ceremony attended by Digital Economy Deputy Minister Eng. Eranga Weeraratne and Telecommunications Regulatory Commission of Sri Lanka (TRCSL) Director-General Air Vice Marshal (Retd.) Bandula Herath. The auction followed the issuance of the Final Notice of Assignment in October, concluding years of regulatory groundwork aimed at preparing the market for 5G deployment.
Spectrum was allocated in two globally significant frequency ranges: the 3.5 GHz band, widely regarded as the backbone for wide-area 5G mobile broadband, and the 27 GHz millimetre-wave band, designed for ultra-high-capacity, short-range use cases. Licences have been granted for a 10-year period under a clock-auction mechanism, which authorities say ensured transparency and market-based price discovery.
Addressing the event, Deputy Minister Weeraratne said the auction marked the largest spectrum sale by value in Sri Lanka’s history and demonstrated confidence in the country’s digital trajectory. He noted that operators are expected to move swiftly from spectrum assignment to network rollout, enabling commercial 5G services in the near term.
Beyond faster mobile internet, the Government views 5G as a platform technology with broad economic implications. Officials say it will support Industry 4.0 applications such as smart manufacturing, precision agriculture and intelligent logistics, while enabling low-latency services critical for telemedicine, connected transport and advanced enterprise solutions. The technology is also expected to accelerate adoption of artificial intelligence, the Internet of Things and cloud-based services across both public and private sectors.
The Government is also moving to finalise enforceable rules on active and passive infrastructure sharing, with technical assistance from the World Bank and the Asian Development Bank. Policymakers argue that shared access to towers, fibre and related assets is essential to reduce duplication, lower costs and speed up nationwide 4G and 5G coverage.
With satellite-based internet services expanding rapidly worldwide, authorities believe a robust 5G ecosystem will help local operators remain competitive by offering high speeds, low latency and large bandwidth at affordable prices. The auction, officials say, highlights what coordinated action between the Government, regulator and private sector can achieve as Sri Lanka pushes ahead with its digital economy agenda
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