Trai wants DoT to relax auction terms for telecom operators

Telecom regulator Trai has suggested a reduction in the bank guarantee given by mobile operators, and sought some clarifications on network roll-out conditions for the spectrum auctions slated for February 3.
Telecom Regulatory Authority of India (Trai) has written a letter to the Department of Telecom asking it to reduce performance bank guarantee (PBG) substantially to Rs 14 crore for each non-metro service area, and Rs 7 crore for Delhi, Mumbai and Kolkata service areas.
As per the auction rules, DoT has asked new entrants in any service area to submit Rs 35 crore PBG and existing service providers Rs 21 crore per service area for a minimum period of six years before signing the licence agreement.

According to Trai, if a telecom operator misses the deadline for rolling out networks there can be a maximum penalty of Rs 7 crore in the 5-phase roll-out, and beyond the grace period the company's licence can be cancelled.
Trai said that at any point of time a company can't be in violation of more than two consecutive phases, for which the maximum possible penalty can be Rs 14 crore.
"Trai thus wants PBG amount should be Rs 14 crore for each licenced service area (LSA) except Delhi, Mumbai and Kolkata where PBG should be Rs 7 crore per LSA," official sources said, citing the letter dated January 2.

The last date for stakeholders to seek clarifications on DoT's auction rules was December 24. DoT issued clarifications and amendments on January 2, when the Trai letter was written. However, it could not be ascertained if DoT will take into account these suggestions.

Trai has asked DoT to treat radiowaves in 900 Mhz and 1800 Mhz bands as separate set of frequencies instead of counting them as one set. At present, both these bands are used by GSM service providers like Airtel, Vodafone and Idea.
The regulator has sought clarification on assessing roll- out obligation of a telecom operator if it decides to deploy different technologies in these bands.

Trai has suggested that DoT allow telecom operators to deploy any technology in the spectrum alloted through auction.
The auction rules say that within one month of obtaining the licence, telecom operator shall provide details of the technology proposed to be deployed for operation, if the technology happens to be GSM/WCDMA (3G)/LTE (4G) and one year before deploying any other new technology.
Trai has asked DoT to incorporate an additional point that if a telecom operator decides to shift to any new technology mid-way of the licence period, then it should give minimum notice of three months to customers who are likely to be affected with the change.