Idea Cellular may write-off Rs 17,000 cr

Telecom operator Idea Cellular may have to write-off Rs 17,000 crore if the government decides to change the frequencies it uses to offer services upon expiry of its licence,a company official today said.

Written by Agencies | New Delhi | Published: April 4, 2012 8:34:16 pm

Telecom operator Idea Cellular may have to write-off Rs 17,000 crore if the government decides to change the frequencies it uses to offer services upon expiry of its licence,a company official today said.

Telecom Regulatory Authority of India has proposed to shift existing telecom players providing their services in 800 and 900 Mhz bands to some other frequency band after expiry of their telecom licences.

“If subscribers are shifted from 900 Mhz,Rs 17,000 crore will have to be written off for one year by Idea,” an Idea Cellular representative said at the Trai’s Open House Discussion on ‘Auction of Spectrum’.

In India,2G services are being provided through 800,900 and 1800 Mhz frequency bands.

“This (write off amount) will translate into much more if others are included,” the representative said while talking about issues that may arise due to refarming of 800 and 900 Mhz from existing telecom operators.

He added that 500 million customers are being serviced by 800 and 900 Mhz bands.

In the draft national telecom policy,the government has proposed refarming of spectrum in 800 and 900 Mhz bands and it may ask telecom operators to surrender spectrum in these bands so that the same can be redistributed for high-end services.

Some leading service providers like Bharti Airtel,Idea Cellular and Vodafone have spectrum in these bands.

Spectrum in the 900 Mhz band is considered more efficient and allows operators to save huge cost due to the low requirement of infrastructure.

Due to high effeciency,these frequency bands are considered to be more valuable than 3G spectrum band.

The industry is divided over refarming of spectrum with old operators against it,while new operators have favoured the move.

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