Battle lines drawn

A day after its operator-unfriendly recommendations on new spectrum charges became public,the sector regulator Telecom Regulatory Authority of India came under unprecedented attack from most big mobile operators,who closed ranks in taking the regulator head-on,indicating that all options are on the table from returning excess spectrum to dragging the issue to courts if push comes to shove. With Trai recommendations which need to be vetted by the government before it becomes law threatening to upend...

Telcos may return surplus spectrum due to high costs

A day after its operator-unfriendly recommendations on new spectrum charges became public,the sector regulator Telecom Regulatory Authority of India Trai came under unprecedented attack from most big mobile operators,who closed ranks in taking the regulator head-on,indicating that all options are on the table from returning excess spectrum to dragging the issue to courts if push comes to shove.

With Trai recommendations which need to be vetted by the government before it becomes law threatening to upend their finances,the countrys largest telecom operator Bharti Airtel and the second-largest GSM operator Vodafone-Essar joined Tata Teleservices in slamming the regulator,setting the stage for a long-drawn,vexatious war for airwaves. Only one operator,the Anil Ambani-led Reliance Communications has so far welcomed the recommendations.

Sources said that the government has taken note of the industrys alarm and has initiated moves to put in place a ministerial panel to vet the suggestions rather than leave the Department of Telecommunications DoT to handle the whole issue. The DoT created a mess in 2007-08. It cant be entrusted solely with a major task when so much is at stake, said an official.

In case the recommendations are accepted by the government,the sheer burden on operators will be so large that they will surely go to court. Such changes in regulatory regime definitely do not help in attracting foreign investment in the country, Romal Shetty of KPMG said.

So miffed is the industry that it is contemplating returning the excess spectrum held by it in case it is made to pay 1.3 times the 3G price. If we manage to win 5 MHz of 3G spectrum,which is in 2.1 GHz band and offers scope for better voice and data services,servicing higher revenue paying customers,why should we pay a higher price for 3.8 MHz of spectrum in the 1,800 MHz band,wondered an official at one of the telcos hit by the recommendations.