Govt allows telcos to hold higher spectrum

The government today announced the new telecom policy (NTP) allowing operators to hold higher spectrum, pay uniform licence fee across services besides permitting liberal merger and acquisition, with a view to provide quality services at affordable prices.

Announcing a part of policy, Telecom Minister Kapil Sibal told a press conference that "the prescribed limit on spectrum assigned to a service provider will be 2x8 MHz [paired spectrum] for GSM technology for all service areas other than Delhi and Mumbai where it will be 2x10 MHz [paired spectrum]."

Current prescribed limit is 6.2 MHz of GSM spectrum.

However, players would be free to acquire additional frequency beyond the prescribed limit, in the open market, should there be an auction of spectrum subject to the limits prescribed for merger of licences.

When asked about the impact of new norms announced today on subscribers, he said users should get better services and at affordable rates due to more efficient usage of spectrum.

All spectrum would be delinked from the licence from now, he said, adding that a decision on pricing of spectrum or one-time charge for extra spectrum held by some incumbent operators would be taken later in view of the Supreme Court judgement that cancelled 122 2G licences issued in 2008.

He also announced a uniform licence fee of 8% of Adjusted Gross Revenue (AGR) across services and circles as compared to range of 6-8% now. Licence fee is a levy paid by all operators as the annual fee.

On renewal of licences, Sibal said the renewal of licence would be done for 10 years.

Besides, he also announced a liberal merger and acquisition regime in the sector allowing upto 35% market share for the merged entity while taking note of Trai's recommendation to consider market share upto 60%.

He said a decision would be taken soon in this regard.