COAI asks Trai to withdraw spectrum cap plan

The present intra band spectrum cap of 50% in a particular band should be continued and extended to spectrum in 700 Mhz and 2,500 Mhz bands

The Cellular Operators' Association of India (COAI) on Thursday asked the Telecom Regulatory Authority of India (Trai) to withdraw proposals of spectrum cap of sub-1 Ghz and clubbing 2,300 Mhz and 2,500 Mhz as one band for intra band cap in the interest of consumers, competition and the industry.

The present intra band spectrum cap of 50 per cent in a particular band should be continued and extended to spectrum in 700 Mhz and 2,500 Mhz bands, COAI said in a letter to Trai.

As per the current spectrum cap rule, a telecom firm cannot own more than half of particular band in a circle and its total spectrum possession may not cross 25 per cent in a particular area.

Earlier also, COAI expressed concern over Trai's proposal to introduce a spectrum cab of sub-1Ghz by replacing the 50 per cent in band cap.

Last month, while inviting recommendations on floor price of spectrum, Trai had said 2,300 Mhz and 2,500 Mhz spectrum should be considered as one band since the ecosystem in this band is not fully developed, and is less likely that any new entrant will come in this band after imposition of cap.

COAI is opposing such considerations saying it would lead to monopoly of a particular player in a particular band.

"These two bands have a completely different device ecosystem and therefore, treating 2,300 Mhz and 2,500 Mhz as one band for intra-band cap may result in one operator acquiring a disproportionate amount of spectrum in one of band, which will create one operator's monopoly," Rajan Mathew, secretary-general of COAI, said in a letter to Trai Chairman RS Sharma.

The industry body also reiterated its stand to impose capping option for 700 Mhz band, which will be put up for auction soon. In the upcoming auction, the regulator will auction off spectrum in 700, 800, 900, 1,800, 2,100, 2,300 and 2,500 Mhz bands in several circles. The 2,500 Mhz band will be put for auction soon.

"Appropriate intra-band caps are essential to prevent potential spectrum grabbing or monopolisation of the spectrum in a spectrum band by any single operator. Any spectrum cap should facilitate an outcome where all mobile operators may reasonably be able to claim necessary spectrum holdings in a particular band."

The proposal of sub-1 Ghz spectrum caps, once enforced, will promote spectrum concentration in a specific band with a single operator. "It will seriously affect level-playing field and deprive many operators to acquire spectrum in a particular sub-1 Ghz band.

Many in the industry believe these proposals of separate sub-1 Ghz cap and treating 2,300 Mhz and 2,500 Mhz as one band will defeat the very purpose of prescribing the intra-band spectrum cap, the letter added.