Trai sticks to stand on selling entire 700-MHz band

The auction has a potential to fetch Rs 5.36 lakh crore revenues for the govt

The Telecom Regulatory Authority of India (Trai) has iterated its stance on auctioning all available spectrum in the 700-MHz band in an upcoming sale.

Trai said in a response to the department of telecommunications (DoT) if all the available spectrum was put to auction it would help serve larger a subscriber base and increase data speeds.

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Besides, this would result in more recurring revenue to the government in licence fees, spectrum use charges and service tax, it added. The Telecom Commission (TC), the policy-making body of the DoT, had reverted to Trai over its recommendations on reserve prices for auction of spectrum.  An internal committee of the DoT was not in favour of auctioning the entire available spectrum in the 700 MHz band, which will be sold for the first time.

STICKING TO GUNS

• An internal committee of the DoT was not in favour of auctioning the entire available spectrum in the 700-MHz band, which will be sold for the first time
• According to the Trai paper, the cost of delivering mobile services in the 700- MHz band is 70 per cent lower than in the 2,100-MHz band widely used for 3G telecom services

Broadband connectivity is a pillar of the Digital India programme, which can be fulfilled quickly if sufficient spectrum is made  available. India is way behind in broadband penetration and Internet speed and the 700 MHz band can be critical for spreading connectivity.  According to the Trai paper, the cost of delivering mobile services in the 700 MHz band is 70 per cent lower than in the 2,100 MHz band widely used for 3G telecom services.

“The entire spectrum in the 700 MHz band is required to be made available for commercial use without any delay,” Trai said in a letter to the DoT. It also said if a service provider was not using administratively assigned spectrum without justification, it should be taken back.  The government plans a round of spectrum auction in the second half of 2016.  After Trai’s response, the Telecom Commission will meet again to finalise its views and will send its recommendations to the Cabinet. Ratings firm ICRA expects spectrum worth Rs 60,000-80,000 crore will be sold in this auction, which will add to the sizeable debts of the industry. The auction has the potential to fetch the government Rs 5.36 lakh crore.