Trai to suggest pricing plan for 3G spectrum

The Telecom Regulatory Authority of India (Trai) will suggest a pricing formula for 3G spectrum as part of its recommendations on spectrum which are expected to be announced tomorrow.

The regulator, which had a marathon meeting today, will submit its recommendations to the department of telecom on September 30.

With only 25 Mhz of spectrum available and more than seven to eight national mobile players (each require a minimum of 5 Mhz to offer 3G), Trai has been looking at various options and is also considering a hybrid formula which includes a minimum baseline price, followed by either a beauty parade or an auction based on various criteria.

Among the other options available are giving the spectrum free, auctioning it or going in for a beauty parade.

The option of a hybrid formula includes a minimum base price, followed by a beauty parade based on criteria like who pays the highest revenue share and who offers the cheapest 3G pricing. Trai has ruled out giving spectrum free of cost.

It is also debating whether to go in for mixed use of spectrum, a demand made by some CDMA operators, which say they should be given about 10 Mhz of spectrum available on the 1900 band.

However, this move has been opposed by GSM players, which say this would lead to interference in their system as they operate in a similar band.

The Association of Unified Service Providers of India (representative of CDMA operators), with Qualcomm, has even told the government to have pilot tests which prove there is no interference.

At least seven operators "" Bharti, Hutch, Reliance, Tata Teleservices, BSNL, Spice and Aircel "" are in the fray for spectrum. Among these, Reliance and Tata offer CDMA-based mobile services, while the others use GSM technology.