Trai sticks to its view on spectrum pricing

Regulator firm on simultaneous auction of bands

The Telecom Regulatory Authority of India (Trai) on Monday stuck to its original recommendations on pricing spectrum and simultaneous auction of the 800, 900, 1,800 and 2,100-MHz bands, rejecting the Telecom Commission’s view that it should reconsider most of its suggestions on the next round of sale of air waves.

The regulator reiterated its view that the government auction 2,100 MHz along with the 800, 900 and 1,800-MHz bands; otherwise, uncertainty would continue. The Telecom Commission had said auctioning the 2,100-MHz band would not be possible because the defence forces were unlikely to vacate it in the near future.

In response, Trai said all 120-MHz (2x60) air waves in the 2,100-MHz band should be made available for commercial use but released in the medium term.

“The rationale is to ensure the availability of sufficient spectrum in this band for commercial purposes. The swapping of spectrum in the 2,100- MHz band with defence for spectrum in the 1,900-MHz band should be done quickly, so it can be put to auction in the next round,” the regulator said. It added once the agreement was reached with “defence for the swapping of spectrum, the actual release of spectrum will be required only at the expiry date of the licences”.

Trai said the government should take necessary steps to make available additional spectrum in the 900, 1,800 and 2,100-MHz bands by taking back 1.2 MHz of 900 MHz spectrum from state-run Bharat Sanchar Nigam, using idle 1,800 MHz spectrum in the defence band and vacating spectrum held in excess of 20 MHz by the military in the 1,800-MHz band.

Communications and Information Technology Minister Ravi Shankar Prasad recently met newly-appointed Defence Minister Manohar Parrikar and they agreed in principle to the swap.

The Telecom Commission had asked the regulator to review the reserve prices considering spectrum up for auction would be much less than what Trai had suggested.  “There is no change in the reserve prices for spectrum in the 900-MHz and 1,800-MHz bands from what were recommended earlier,” Trai said.

According to a Trai statement, constrained supply of spectrum posed a “real threat” to the continuity of telecom services to millions of subscribers by the expiry of licences.