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| DoT Seeks AG’s View on Pricing of existing 2G Spectrum |
| Wednesday, 27 June 2012 | |
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The Department of Telecommunications (DoT) has sought the opinion of Attorney General Goolam Essaji Vahanvati, on the plans to make it compulsory for all operators to pay auction-determined price for their existing 2G airwaves for the remaining period of their licences. The DoT has informally sounded out on this issue, and is planning to send a formal communication seeking the law ministry’s views on this controversial proposal. Earlier this month that DoT has circulated a Cabinet note on charging existing players auction-determined price for the airwaves they hold. The note also said that the department was of the view that a one-time fee was necessary for creating a level playing field. Industry calculations show that if the Cabinet approves the telecom department’s proposal, the government can collect over Rs 1,00,000 crore from existing operators such as Bharti Airtel, Vodafone, Reliance Communications, and Tata Teleservices. This proposal has been sharply criticised by AUSPI, which says it will impact its members such as RCOM and Tata Teleservices far more than GSM operators. AUSPI has argued that the plan to charge existing operators auction-determined rates prospectively was discriminatory and would aggravate the prevailing inequality between old GSM operators and others. AUSPI has also demanded that the government should defer this proposal until Supreme Court rules on the Presidential Reference. While DoT favours charging existing operators market-determined rates prospectively, it has also suggested three other options in the Cabinet note — imposing a one-time fee on airwaves held beyond the start-up spectrum of 4.4 MHz, or on airwaves held above the contracted spectrum of 6.2 MHz, or not charging any fee at all. DoT Finalising Auction Rules The telecom department is close to finalising the guidelines for the upcoming airwaves auction and has decided to hold simultaneous, multiple-round auctions for each region, similar to the third generation spectrum auctions in 2010. New entrants and companies that lost their mobile permits due to the Supreme Court ruling on February 2 can bid for a maximum of 6.25 MHz of airwaves in 1800 MHz band in the upcoming auctions, states the draft auction guidelines. Existing operators or incumbents in the GSM space can bid for a maximum of two blocks, or 2.5 MHz of airwaves. In the CDMA space, companies that lost their licences, such as Sistema, can bid for a maximum of 3 blocks (3.75 MHz) in the 800 MHz band, while existing operators can bid for only one block, according to the draft auction guidelines. –Communications Today Bureau |
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