DoT partly accepts Trai's report on spectrum issues

The Telecom ministry has disfavoured a lower licence fee of six per cent as against up to 10 per cent now while accepting suggestions with regard to delinking of licences with spectrum, on M&As and reframing of 800/900 MHz spectrum.

Last month, the Telecom regulatory Authority of India (Trai) had made its recommendations on spectrum management and licensing framework recommending Rs 10,972.45 crore for a pan-India licence with 6.2 MHz spectrum and a one-time fee for additional spectrum beyond 6.2 MHz at the rate of Rs 4,571.87 crore for one MHz for pan-India.

A seven-member team of the Department of Telecommunications (DoT), involving officials from technical and finance divisions, is understood to have given its report on Trai's recommendations to Telecom Minister Kapil Sibal, sources in the know said.

The department had earlier suggested a uniform licence fee of 8.5 per cent of Adjusted Gross Revenue (AGR) and the DoT team has stuck to its proposal while declining Trai's recommendations of uniform license fee of six per cent to avoid any revenue loss to the government.DoT committee has also accepted the spectrum assignment with an upper limit of 6.2 MHz of GSM spectrum and 5 MHz of CDMA spectrum for all service areas other than Delhi and Mumbai, for which the upper limit will be 10 MHz. However, the DoT is unlikely to accept the recommendations with respect to non-auctioning of 2G spectrum and the contracted spectrum.

Trai had recommended not to auction 2G spectrum in 800, 900 and 1,800 MHz band. It has also endorsed Trai’s recommendations on merger and acquisition so that the market share of the resultant entity should not be greater than 30 per cent of the total subscriber base and the annual gross revenue in the service area, subject to the number of service providers not falling below six in this area.