New 2G norms to make Govt richer by rs 11,200 cr

Guidelines to impact BSNL, MTNL the most

Operators Bharat Sanchar Nigam Ltd, Bharti Airtel, Vodafone-Essar, Aircel, Mahanagar Telephone Nigam Ltd and Idea Cellular might have to fork out over Rs 11,200 crore for having spectrum beyond 6.2 MHz, if the government accepts the Telecom Regulatory Authority of India (Trai) recommendations.

A bulk of this additional amount — Rs 4,800 crore — will come from the two metros, Delhi and Mumbai, where spectrum beyond 6.2 MHz has been allocated to all players.

The impact, according to telecom experts, will be the most on BSNL and MTNL combined. They will have to pay over Rs 5,000 crore due to the additional spectrum they have got in all circles, followed by Bharti (Rs 3,000 crore) and Vodafone-Essar (Rs 1,715 crore). While BSNL will have to pay around Rs 2,445 crore, MTNL needs to shell out Rs 2,302 crore and Idea, Rs 1,000 crore, according to preliminary estimates by telecom analysts.
 

SPECTRUM SPECS OPERATORS WITH MORE THAN 6.2 MHz IN KEY CIRCLES
State/  City	No of operators	Operators with MHz

81012.4 Delhi12121 Mumbai11031 Maharashtra12120 Gujarat11110 Tamil Nadu11130 Andhra Pradesh12120

Again, the existing service providers would have to fork out extra money when their licences come for renewal. Mobile licences of some of the players like Bharti Airtel and Vodafone-Essar are due to expire as early as 2014.

The government is expecting Rs 50,000- 55,000 crore from the 3G auction and another Rs 11,200 crore from 2G. It would together make nearly one per cent of the country’s gross domestic product.

However, some operators say the additional revenue which they have to cough up could get neutralised from the savings they will incur due to Trai’s decision to go for a unified licensing regime at six per cent of revenue.

Earlier, for instance, they had to pay 10 per cent in Delhi and Mumbai, which, if Trai’s recommendations are accepted, will reduce to four per cent.

Says a senior executive of a leading telecom company: “The annual revenue from these two cities is around Rs 8,000 crore. So, a savings of four per cent would translate to about Rs 320 crore annually for the operators. While we would be loaded upfront with new payments, we will make them up in a few years.”

Trai today recommended that operators who already have spectrum beyond 6.2 MHz will have to pay a one-time fee on a pro rata basis on the remaining years of the licence (a unified access service licence has a validity of 20 years), which will be equivalent to the 3G auction price. While the auction for 3G is still under process, the value of a pan-India licence has already hit over Rs 14,000 crore.

According to data available, MTNL has been given spectrum of up to 12.4 MHz in Delhi and Mumbai. A total of 28 licensees have been given up to 10 MHz, while 21 licencees have been issued spectrum of up to 8 MHz.