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COAI urges government not to reserve or de-license spectrum identified for Private Captive Networks

Presently, the resources for operating such private network are made available from the resources of licensed service providers which include spectrum acquired through a transparent auction process.

We are of the firm opinion that notwithstanding any advancement of technologies, there is no justification whatsoever for allocating spectrum to industry verticals for operating private captive networks. The licensed Access Service Providers are fully capable of providing all customised solutions including M2M / Industrial 4.0 services in the most competitive and economic manner and are in fact providing such network configurations to private and public sector entities. Hence, there is no need to alienate spectrum directly to companies for captive private networks.

When a private network is part of a commercial network, it addresses the following issues for orderly growth of the sector:

  • Neither the legitimate revenue of licensed service provider is truncated nor there is any revenue loss to the Government exchequer in terms of payment for acquiring spectrum through auctions and payment of license fee and Spectrum Usage Charge (SUC). Thus, it is respectfully submitted that the requirement of industry verticals can be best met through operator-led private networks.
  • This approach also adheres to the principle of “Same Service Same Rules”. Any move such as setting aside/ allocation of 5G spectrum (via delicensed/ administrative basis) for catering to the connectivity needs of Industry 4.0 / M2M communication services by way of industry-led private captive networks, will not only truncate the revenues of the licensed service providers but also affect the revenues of the government. this will also create a non-level playing field, leading to arbitrariness in basic policies discouraging investment in the networks and leading to disorderly growth of the sector by back door entry with undue advantage to private commercial entities at the cost of the government exchequer.
  • A private network operated within the commercial network also fulfils the requirement of “law enforcement agencies” as necessary lawful interception and monitoring is provided by the service provider while no such facility is available to leas in private captive networks. the anti-social elements may exploit this facility to bypass interception and monitoring of messages which would be detrimental to national security.
  • It is pertinent to note that spectrum is a key finite resource with high economic value. The spectrum allocation in any spectrum band that can be used to deploy and provide communication services, irrespective of the entity desiring to use the spectrum or the technology deployed or the type of services offered, should be allocated only through a transparent and open auction process. Therefore, we do not support delicensing/ reserving any Spectrum bands for Private Captive Networks or any other services like M2M services in the guise of Industry 4.0.

We would also like to bring to your notice the GSMA Report on ‘Mobile Networks for Industry Verticals: Spectrum Best Practice’ vide which they have stated that great care needs to be taken to ensure verticals are fully supported without harming other wireless users – especially consumers and businesses who rely on 4G and 5G. Verticals can benefit from telco’s more extensive networks, more substantial spectrum assets, expertise and, typically, operators’ lower cost base. Use of dedicated set-asides for verticals poses significant risks to wider mobile services, most notably slower 5G networks and reduced coverage. The main highlights of the report are given below:

  • Commercial mobile operators support the needs of a wide variety of vertical sectors and will have added capabilities with 5G
  • Spectrum leasing or, when carefully planned, other types of spectrum sharing can be viable options for supporting verticals who want to build private networks
  • Spectrum that is set aside exclusively for verticals in core mobile bands risks being underused and can undermine fair spectrum awards
  • Spectrum set-aside in core mobile bands can also threaten the wider success of 5G – including slower rollouts, worse performance and reduced coverage
  • Policymakers should consider coexistence challenges when different use cases need to be supported in the same mobile band
  • Unlicensed spectrum is likely to play an important role for numerous verticals
  • Policymakers should carefully consider their options and consult stakeholders to ensure they most efficiently support the needs of verticals without undermining other spectrum users

With the digital transformation of industry and increased automation, telecom players are both able and willing to offer connectivity in terms of private networks or any other services like m2m services. such networks are part of their commercial operations and therefore, all resources should be procured in transparent commercial manner only. In a competitive market, the true value of resources can only be realized through a commercial process which ensures efficient allocation and best use of the resources.

We urge the Government not to reserve or de-license any spectrum which has been identified or likely to be identified for use of IMT/ commercial services for Private Captive Networks. Any de-licensing/reservation of IMT/commercial spectrum for captive industrial use/establishment of private networks, as demanded by few companies, would not only cause huge loss to the exchequer but will also lead to sub-optimal utilization of this scarce resource. Hence, such a move is also technically uncalled for. Sufficient unlicensed spectrum bands are available to cater these private network requirements for captive networks.

It is not out of context that in our country, Hon’ble Supreme Court of India has pronounced a judgment in CWP 423 of 2010 mandating the Government for the alienation of resources like spectrum through a transparent auction process only. Therefore, in our humble submission delicensing/ administrative allocation of spectrum for Captive Networks/ M2M services/ Industry 4.0 is legally untenable in our country.

Keeping in view the above, we submit that:

  • In today’s scenario there is no need for separate private captive networks and same should be dispensed with given the availability of state-of-art telecommunication network.
  • Private Captive Networks can be detrimental to national security.
  • The licensed Access Service Providers are fully capable of providing these services in most competitive and economic manner compared to private companies looking for such solutions.
  • Request the Government not to reserve or de-license any spectrum which has been identified or likely to be identified for use of IMT/ commercial services for Private Captive Networks. It amounts to undue advantage to private commercial entities at the cost of government exchequer.
  • Any de-licensing/reservation of spectrum for Industrial use/establishment of private Captive networks, as demanded by few companies, would not only cause huge loss to the exchequer but will also lead to sub-optimal utilization of this scarce resource. Hence, such move is not only technically uncalled for but also legally untenable.

CT Bureau

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