Spectrum of changes in the new telecom policy

In a major setback to the existing GSM players, the department of telecommunications...

In a major setback to the existing GSM players, the department of telecommunications (DoT) on Friday accepted the Telecom Regulatory Authority of India’s (Trai) recommendation on the new criteria for allotting spectrum to the existing subscribers. DoT has also accepted Trai’s other major recommendations that include no cap on the number of operators in a service area and use of dual technology by the telecom operators.

In its recommendations on reforms in the licensing regime, the regulator had suggested increase in the subscriber-link criterion for allocation of frequency spectrum to telecom service providers. Trai had also recommended that in case any mobile telephone service provider wants additional spectrum beyond 10 MHz in the existing 2G bands, i.e., 800, 900 and 1800 MH after reaching specified subscriber numbers, shall have to pay a onetime spectrum charge on prorata basis for allotment of each MHz or part of spectrum beyond 10MHz. For one MHz allotment in Mumbai, Delhi and category A service areas, the service provider shall have to pay Rs 16 crore as onetime spectrum acquisition charge. For category B circles, this fee is Rs 8 crore.

This goes against the existing GSM service providers, as they will now have to invest more on their network. DoT has also set up a committee in the telecom engineering centre (TEC) to further study the issue of spectrum.

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“In order to enhance the penetration of access services for rapid expansion of tele-density, it has also been decided that the existing private UAS Licencees may be permitted to expand their existing networks by using alternate wireless technology — the present UAS Licencee, who is using GSM technology for wireless access may be permitted to use CDMA technology and vice-versa,” according to a statement issued by the DoT. As reported by The Indian Express on Friday, DoT on Thursday permitted Reliance, HFCL and Shyam to offer GSM services. They are currently providing mobile services using GSM technology.

Allocation of spectrum for the alternate technology would be done to CDMA players on payment of a fee equal to the entry fee for getting a new unified access service licence.

In order to encourage efficient spectrum utilisation, the “Spectrum Enhancement Charge”, in addition to annual spectrum charges based on revenue share, would be levied at the time of additional spectrum allotment to licensees beyond 10MHz for GSM and 5MHz for CDMA. For each additional 1 MHz or part thereof “Spectrum Enhancement Charge” of Rs 16 Crore, 8 Crore, 3 Crore for Metro/ Category ‘A’, Category ‘B’, Category ‘C’ service areas respectively would be charged. The existing GSM operators have opposed the government decision saying that it was illegal.

New lines

•One-time fee on use of spectrum to be imposed

•CDMA operators allowed to offer GSM-based mobile services and vice versa

•No capping on number of operators

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