COAI wants Trai to retain band-wise spectrum caps

As of now, no operator cannot hold more than 50% of air waves in a given band and 25%of total spectrum (across bands) in a given service area

Cellular Operators Association of India (COAI), have written to the Telecom Regulatory Authority of India (Trai) on its proposal to reset the spectrum cap for the sub-1 GHz bands (700 Mhz, 800 MHz and 900 MHz).  As of now, no operator cannot hold more than 50 per cent of air waves in a given band and 25 per cent of total spectrum (across bands) in a given service area. The telecom regulator proposed to alter this in its consultation paper dated 26 November.

Trai's consultation paper said: "Instead of putting a separate cap only on the 700 MHz band spectrum, another approach could be clubbing together of all sub-1 GHz spectrum bands i.e. 700 M Hz, 800 MHz and 900 MHz bands and impose a limit on spectrum that one TSP can acquire in these bands."

Earlier, due a cap on spectrum holding, an operator could not hold more than 50 per cent of air waves in a select band. But if Trai's proposal is implemented and a composite cap is applicable in the sub 1 GHz bands, an operator can bid for a large chunk of the spectrum in any one of the bands and yet not breach the cap.

In its letter to Trai, COAI's Rajan Mathews writes, "The industry is deeply concerned over the proposal of a new spectrum cap, which once enforced, may promote spectrum concentration in a specific band with a single operator. It will seriously affect level playing field and may deprive many operators from acquiring fresh spectrum in a particular sub-1GHz band. Therefore this question needs to be dropped from the consultation paper."

Spectrum in the lower bands or the sub-1 GHz bands is considered to be efficient and with the government proposing to auction airwaves in the 700 MHz, the GSM industry fears that the move to alter spectrum holding caps mid-way could result in concentration of airwaves in a certain band in the hands of a few operators. The GSM industry fears that if the current caps are changed, then select operators could consolidate their holding in either 800 MHz or 700 MHz. The 900 MHz band is dominated by the GSM players to offer 2G and 3G services.

COAI further goes on to say that the goal of the TRAI for prescribing band-wise spectrum cap has been to ensure a level playing field for operators and to provide equal opportunity for acquiring spectrum in each band. Interestingly, the industry body goes on to say: "The majority of the industry believes strongly believes that the proposal of a limited number of operators, who may accumulate disproportionate holdings in a particular sub 1 GHz band for example 800 MHz or 700 Mhz band will defeat the purpose of prescribing the intra band spectrum cap."

It may be noted that Reliance Jio has acquired spectrum in the 800 MHz band to offer its 4G services and has also entered into spectrum trading pacts with Reliance Communications for seven other circles where it had not acquired spectrum.