Changes recommend by TRAI in spectrum surrender guidelines- who benefits most?

The Telecom Regulatory Authority of India (TRAI) has recommended a number of changes in the spectrum auction and surrender guidelines that will benefit the country’s top three carriers Vodafone Idea, Reliance Jio and Bharti Airtel.

According to the new guidelines, telecoms will be allowed to surrender the spectrum after 10 years of acquiring the airwaves.

“For ease of doing business, easy and transparent spectrum surrender guidelines with a spectrum surrender fee of Rs 1 lakh per spectrum band per LSA (license area) has been recommended,” the regulator said.

What are the spectrum surrender recommendations?
Under the recommendations, operators will have to make a request for surrendering the spectrum 12 months in advance, TRAI said. Within 60 days of the date of application, the Department of Telecommunications (DoT) will provide in-principle approval. Then, the telecom company will have to clear all the dues related to the spectrum as communicated by DoT.

The government will put the surrendered spectrum up for auction. The operator that has surrendered the spectrum will not be allowed to participate in the auction for the same airwaves for a minimum of two years.

While surrendering the frequency, the telecom operator will have to pay a fee of Rs 1 lakh, TRAI said.

Who will benefit from it?
Vodafone Idea is likely to benefit most from the new spectrum surrender guidelines as the telecom operator will be able to get rid of airwaves that are not serving the company and its business in any manner, Indian telecom news portal TelecomTalk reported. Reliance Jio and Bharti Airtel are also likely to benefit from TRAI’s latest recommendation, it said.

Slashing spectrum prices
In another move to bring major relief to telcos, TRAI has also recommended about 40 percent cut in the floor prices for airwaves across all spectrum bands, including the latest 5G offering, media reports said.

The regulatory authority has suggested that base prices be brought down to Rs 3,927 crore per MHz on a pan-India basis, which is 40 percent lower than the prices it recommended in 2018.

In key circles of Mumbai and Delhi, TRAI has recommended cutting base prices for the 700MHz band by as much as 58 percent and 45 percent at Rs 470 crore and Rs 509 crore, respectively, for paired spectrum for a 20-year period.

TRAI also recommended putting available spectrum in the existing bands — 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz.

Apart from this, auction for airwaves in the new bands such as 600 MHz, 3300-3670 MHz and 24.25-28.5 GHz has also been recommended by TRAI.

Setting the stage for the rollout of 5G services, TRAI recommended a 36 percent cut in the base price of 5G spectrum band (3300-3670MHz band) to Rs 317 crore across the country from the Rs 492 crore suggested in 2018.

The government is likely to approve all of TRAI’s recommendations as it plans to hold spectrum auction by May-June. CNBCTV18