Government sets up a panel of secretaries to streamline telecom spectrum allocation

Telcos have for long been demanding that the government gives a clear road map for auctioning spectrum, which would help them plan and allocate resources efficiently, roll out latest technologies, optimise networks and ensure quality services. In ...

KOLKATA|NEW DELHI: The government has constituted a panel of secretaries under cabinet secretary Rajiv Gauba to streamline the spectrum allocation process and examine the possibility of drawing up an annual calendar for auction of airwaves that will give telcos a clear road map of the quantum as well as the frequency of spectrum on offer for commercial use.

"Beginning with sorting out various spectrum related issues between ministries, the committee will look at issues such as making the auction of spectrum an annual calendar event," a senior official told ET. "It will also look into the possibility of identifying spectrum which is likely to be released for commercial purposes in future and conveying that to the telcos which can then plan their strategies more efficiently."

Besides Gauba, the panel comprises the secretaries of home, defence, railways, telecom, I&B and department of space. People familiar with the matter said that the ambit of the panel may be widened in the future to also include spectrum pricing issues. The committee had its first meeting on Monday.


Telcos have for long been demanding that the government gives a clear road map for auctioning spectrum, which would help them plan and allocate resources efficiently, roll out latest technologies, optimise networks and ensure quality services. In the past 10 years, the government has auctioned spectrum six times - in calendar years 2010, 2012, 2013, 2014, 2015 and 2016 - but has refrained from giving any clarity on the frequency of future airwaves sale.

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Clarity on availability, timing
Industry experts say without clarity on the timing of the next sale and airwaves possibly on offer, operators have historically been forced to spend top dollars to stock up on the critical natural resource, which is one key reason for their high debt and weak balance sheets.

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The industry, which has spent a cumulative ₹2.51 lakh crore on buying spectrum in the six auctions since 2010, currently has a debt of over ₹8.55 lakh crore, including those related to government dues on airwave purchases.

"Any government road map offering clarity on the frequency of future spectrum auctions would give telcos more comfort and greater predictability about accessing this vital resource," said Mahesh Uppal, director at Com First (India) and an expert in spectrum regulatory matters.

He added that such a scenario would help telcos plan fund-raises more effectively to participate meaningfully in auctions and also take considered tech-related investment calls.

The high cost of spectrum in India has led to calls from some quarters about going back to administratively allocating frequencies, especially 5G , to leave ample financial room for telcos to invest in networks. But the Supreme Court, in its 2012 verdict, had ruled that a scarce natural resource like spectrum with high demand and valuation should not be allocated administratively at a fixed, nominal cost, but auctioned as that was the best and most transparent way for price discovery.

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The discussions come at a time when the government plans to hold a 4G airwaves sale early next year, to be followed by a sale of 5G airwaves later in the year. The last sale happened in October 2016.

Coveted airwaves
The immediate task for the panel is to resolve a tussle between the telecom department and Department of Space on 5G spectrum in the 26 GHz band. The DoS has chunks of these coveted airwaves but is refusing to part with it. The DoT and the telcos want these super-efficient millimeter waves for commercial use, given that the global 5G ecosystem is rapidly developing around this band. They say if access to these airwaves is denied, 5G network deployment costs would jump several-fold, making the ultra-fast wireless broadband service unaffordable in India.
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