DoT will treat big as beautiful while allocating spectrum

Big is beautiful. This seems to be the new mantra of the department of telecommunications DoT for allotting spectrum for cellular mobile services to telecom operators. DoT is formulating new guidelines for allotment of spectrum for mobile services. Under these, DoT may allot GSM spectrum to a service provider for new areas on the basis of the number of service areas in which it is already operating. The Wireless Planning and Coordination WPC wing of the department, which is responsible for management and allotment of spectrum, has sought the Telecom Commission8217;s approval for the new guidelines.

The WPC has proposed that while allotting GSM spectrum to operators in new areas, priority should be given to those operators who have a presence in at least one-third service areas India has been divided in 21 service areas for licensing purpose. The new policy, if implemented and approved by DoT, will benefit big operators in the CDMA space who are seeking GSM spectrum. It will have an adverse impact on small operators. Spectrum is a medium through which signals are transmitted from one handset to another. It is the soul of a mobile telephone network. Being a scarce natural resource, it becomes very important for telecom operators.

One of the reasons why Hutch got a very high price over 11 billion for its 63 per cent stake in Hutch Essar in a recent deal with Vodafone is its spectrum. Sources said that the WPC has said that priority should be given to those operators who have spectrum in at least seven service areas with the same technology. WPC has argued that if spectrum is to be utilised efficiently, it is essential that operators having services in several areas should be given priority. Globally, large operators use spectrum efficiently, claims the WPC.

Under the present policy, a minimum spectrum is guaranteed to all the telecom companies that have been awarded licences for operating cellular mobile services. They are allotted additional spectrum on the basis of the number of subscribers in their network. The present policy does not differentiate a large operator and a small operator on this basis while allotting spectrum.