Spectrum policy ‘way out of line’: TC approves DoT price plan

10 Dec 2014

India’s Telecom Commission has fixed the base prices for spectrum at the upcoming auction, accepting the recommendations of the Department of Telecommunications (DoT) with some exceptions, Telecom Lead reports. The decision has not gone down well with CDMA operators, who will be expected to pay INR36.46 billion (USD588.3 million) per MHz of pan-India spectrum in the 800MHz range, compared to the INR31.04 billion recommended by the Telecom Regulatory Authority of India (TRAI). By comparison, GSM spectrum in the 900MHz band was priced at INR36.93 billion and 1800MHz spectrum was set at INR21.91 billion. GSM operators will also see relief in the form of discounted prices in the Rajasthan (1800MHz, 30% reduction) and North East (900MHz and 1800MHz frequencies, 50% price cut) circles. Commenting on the decision, Mikhail Shamolin the president and CEO of Sistema Shyam TeleServices’ (MTS’s) parent company Sistema, said in an interview with the Times of India: ‘This [decision] is way out of line and does not merit a strong business case for buying additional spectrum. If such a policy framework is implemented then naturally it would be detrimental both for the telecom sector and also to the USD3.5 billion investment already made by SSTL in its operations in India.’

The spectrum sale is set to take place in February 2015 and will see the government sell off 184MHz in the 900MHz range, 104MHz in the 1800MHz band as well as 800MHz spectrum in eleven service areas. The Telecom Commission has agreed with the TRAI’s decision to postpone the sale of 1800MHz frequencies in Maharashtra and West Bengal as only partial spectrum is available. No decision was reached on the regulator’s proposal to take back 900MHz spectrum from state-owned cellco Bharat Sanchar Nigam Ltd (BSNL), however.