An excuse by incumbents to block competition, says official.
The Department of Telecommunications (DoT) today refuted telecom operators’ assertion that a serious spectrum crunch is the cause of poor service quality. Instead, DoT officials said today, it has already given or is in the process of giving over 70 MHz of spectrum, the radio frequency that enables mobile communications, in most of the 22 circles to incumbents and seven new operators.
The spectrum, it says, is enough to support over 700 million customers for the current second generation (2G) services — a subscriber target set for 2012. India currently has over 300 million mobile subscribers.
If the 60 Mhz of spectrum for third generation (3G) services, to be auctioned in January next year, DoT added there will be enough spectrum to support over 1.9 billion customers, almost twice India’s population because 3G services are twice as efficient in spectrum usage than 2G.
DoT’s data does not include another 30 Mhz of 2G spectrum which is expected to be vacated by the Ministry of Defence. This spectrum it says will be enough to allow the entry of another three to four new operators apart from supporting a subscriber base of another 300 million customers.
“There is no shortage of spectrum; the shortage was created by incumbent operators who did not want new players to come in,” said a senior DoT official, adding, “We found there was enough spectrum available even in metros like Delhi and we decided to get more players in.”
The official said apart from 35 MHz of spectrum which were given to incumbent operators, the six to seven new operators have been given about 35 MHz in various circles and will receive more in other circles too.
Mobile operators say the shortage of spectrum is limited to 20 to 30 cities and towns that account for half their revenues.
“The spectrum crunch is in cities like Delhi, Mumbai or Bangalore especially in the central business district where there is very heavy density as a result of which you are facing call drops,” said a senior member of the Cellular Operators Association of India (COAI).
The DoT official also said incumbents have opposed giving 3G spectrum to more than five players. He added that by limiting the spectrum allocated to each 3G player at only 5Mhz, it is virtually impossible for a new player to get in.
“For standalone 3G you need 10 Mhz so a new player will be forced to buy a 2G operator if he wants to operate the service. It already provides protection to existing players.”
