DoT postpones refarming decision, allows operators to swap spectrum

26 Sep 2012

India’s telecom regulators will not make a decision on spectrum refarming until after the upcoming 2G auction, reports the Economic Times. Whilst the government has given the green light to refarming the 900MHz band when the current licences expire, the Department of Telecommunications (DoT) is mulling whether to allow cellcos to retain some of their spectrum in that range or require them to repurchase the frequencies through auction. DoT proposals from April this year suggested reserve prices of between INR131 million and INR14.345 billion (USD2.47 million and USD26.99 million) per MHz of spectrum, depending on the circle, twice the value it set for 1800MHz frequencies. Unsurprisingly, the prospect of refarming has provoked strong opposition from the nation’s cellcos, which threatened that they would be forced to increase tariffs to absorb the additional costs. As a compromise, the DoT and Telecom Regulatory Authority of India (TRAI) are considering allowing cellcos to retain either 2.5MHz or 5MHz of spectrum but will not make a decision until after the auction of 1800MHz spectrum is completed.

In related news, cellcos that are awarded frequencies in the upcoming 2G auction will be allowed to swap frequencies within the same band to allow operators to acquire contiguous spectrum. The Economic Times quotes a senior official at the telecoms ministry as saying that the trades will be allowed once the cellcos have paid the full price of the spectrum and have received permission from the wireless planning and coordination wing.