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India's second largest telecom player claims that DoT's decision to auction spectrum which is held by it, is confiscatory in nature.
“We filed a petition in the Delhi High Court challenging DoT's action of putting its 900MHz spectrum to auction even when Vodafone’s applications for license extension are pending with DoT,” Vodafone said, in a statement.
If DoT were to auction 900 MHz spectrum next month, this spectrum will have to be collected from old telecom players like Bharti Airtel and Vodafone. Both these companies' licences are slated to come up for renewal next year. This is a part of DoT's plan to refarm spectrum, a move which was not welcomed by old telecom operators or incumbents.
While both 1800 MHz and 900 MHz can be used to offer 2G GSM services, 900 MHz is known to be more efficient. Operational costs for services provided under 900 MHz band, are also lower. “The 900MHz spectrum forms the foundation of the network and Vodafone has, over the last 18 years, designed and built its telecommunication networks and infrastructure,” says Vodafone.
DoT has decided to go ahead and auction this spectrum even after a clarification by Supreme Court came in last week, saying that its move to cancel licences last year, did not include this particular band of spectrum. Second round of auctions will be held by the company The auctions for 900 MHz would come up along with 1800 Mhz as well as 800 Mhz in the CDMA band.
Cellular Operators Association of India (COAI) says that collecting spectrum back from operators has to be done legally, under the terms of licence renewal.
“This is not supported by licence terms,” said Rajan S Mathews, director general of COAI.
Vodafone believes that withdrawal of 900 MHz spectrum is disruptive as it will jeopardise investments made by the company, based on promise and or right of continuity as per their licence. The company invested more than Rs 50,000 crore, and has around 150 million subscribers.
“Unilateral action of DoT to auction the 900 MHz which is already allocated, held and being utilised by Vodafone without discussing, considering and deciding on its extension application is arbitrary and confiscatory in nature,” the company said.
Mathews said that 'liberalising' 900 Mhz spectrum as claimed by government is not an additional right. “As per the licence condition, we can already use it for voice, and data as well,” he said.
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