Spectrum auction: Considered ‘all relevant factors’ on prices, Trai to DoThttps://indianexpress.com/article/business/spectrum-auction-considered-all-relevant-factors-on-prices-trai-to-dot-5821651/

Spectrum auction: Considered ‘all relevant factors’ on prices, Trai to DoT

Last month the Digital Communications Commission (DCC), the DoT’s apex decision-making body, decided to ask Trai to reconsider its suggestions on spectrum, to ensure competition and greater participation of larger set of players in the forthcoming auctions.

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The telecom regulator has, however, yielded ground on the issue of lock-in period it had previously recommended for spectrum in 3300-3600 MHz band (for eligibility on spectrum trading).

The Telecom Regulatory Authority of India (Trai) on Monday reiterated its recommendation on reserve price and valuation methodology for spectrum, including that for deploying 5G, telling the Department of Telecommunications (DoT) that it had considered “all relevant factors” while giving views on prices.

Last month the Digital Communications Commission (DCC), the DoT’s apex decision-making body, decided to ask Trai to reconsider its suggestions on spectrum, to ensure competition and greater participation of larger set of players in the forthcoming auctions.

In its detailed response to the telecom department on Monday, Trai said it had considered all the relevant factors, including the methodology, assumptions, developments between the spectrum auction in 2016 and its suggestions of August 1, 2018, and the rationale for spectrum valuation and reserve price while giving its recommendations. “In view of the above, the authority reiterates the spectrum valuation and reserves prices as contained in its recommendations dated August 1, 2018,” Trai said.

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Auction success to determine 5G roadmap

Even as some industry players have pointed out that Trai’s recommended price for 5G frequencies is five to six times higher than auction discovered prices in South Korea, Spain, the UK and Italy, a section believes that India should discover its prices through its own auction, wherein operators are free to not bid if the rates are deemed high. The auction’s success, however, is likely to determine the roadmap of India’s 5G play.

The telecom regulator has, however, yielded ground on the issue of lock-in period it had previously recommended for spectrum in 3300-3600 MHz band (for eligibility on spectrum trading). The telecom regulator has now suggested a lower lock-in period of two years for this band against 5 years prescribed earlier.

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“Authority recommends that no rollout obligations should be mandated for spectrum in 3300-3600 MHz band. Further, lock-in period for spectrum in this band for becoming eligible for spectrum trading should be same as in other bands that is 2 years,” Trai said.

Trai had last year recommended auction of about 8,644 MHz of telecom frequencies, including those for 5G services, at an estimated total base price of Rs 4.9 lakh crore, but the financially-stressed industry that is buckling under high debt, had argued that proposed prices are unaffordable and exorbitant.