GSM players offer Rs 980 cr for 3G

In a clear change from its earlier stance, the Cellular Operators' Association of India (COAI), representing GSM operators like Bharti Airtel and Hutch, has agreed to fork out Rs 980 crore or more as fees for 3G spectrum.

3G mobile services permit high-speed internet access using different wavelengths, and allow operators to offer mobile broadband services like video- and audio-streaming, among other things.

At a meeting called by the Telecom Regulatory Authority of India on Friday, the COAI said the operators were willing to pay whatever compensation the Ministry of Defence needed to be paid for vacating the 45 Mhz spectrum under its control.

However, the rival CDMA operators' association "" AUSPI "" decided to stay away from the meeting, though some executives of its two key operators "" Reliance Communications and Tata Teleservices "" were present, sources said.

COAI Secretary-General T V Ramachandran said: "What we have said is that the industry is ready to pay the entire cost incurred by the government on getting the spectrum from the Ministry of Defence. Today, the cost is around Rs 1,000 crore; if it becomes Rs 1500 crore, we are willing to pay."

The COAI had earlier vehemently opposed any move to pay fees for 3G spectrum. They had opposed a suggestion from Ratan Tata, who in a letter to the government, had suggested that each operator pay Rs 1,500 crore for 3G spectrum.

The sources added that serious differences existed between Tata Tele and Reliance Communications on two counts "" on how much should be paid for the spectrum, and also on the usage of the various bands of spectrum.

The Tatas had made it clear earlier that, in the absence of any other criterion, they were ready to pay Rs 1,500 crore "" what operators pay for a unified access licence across the country. Reliance Communications, it is believed, was not willing to pay such a price.

Insiders said Tata Tele was pushing aggressively for vacation of the 1900 Mhz band, for the natural evolution of CDMA into 3G. However, Reliance Communications was willing to go for both the 1900 Mhz and 2100 Mhz bands.

The Tatas contended that CDMA evolution could not happen on 2100 Mhz, as there was not enough equipment available around the world on this spectrum.

Incidentally, Trai has emphasised the need to look at the option of auctioning spectrum, as done in Europe, to price 3G spectrum "" a move that has been opposed by operators as it could cost each of them a mind-boggling Rs 10,000 crore for an all-India 3G roll-out.