The Telecom Commission — the highest policy-making body in the telecom ministry — on Monday allowed operators holding broadband wireless access (BWA) spectrum in the 2.3 GHz band to provide voice services if they pay an additional R1,658 crore. However, a company like Reliance Industries (RIL) which has pan-India BWA spectrum cannot immediately start providing voice services in a manner in which other mobile operators like Bharti Airtel or Vodafone do. This is because currently, there are no standard devices which can support voice services using the 2.3 GHz spectrum band.
However, what companies like RIL can do if they chose to pay the additional R1,658 crore is to provide voice services from a personal computer or a tablet-like device to landline and mobile phones, which was earlier not allowed. Prior to this decision, a company like RIL could only have provided voice services between computers. So, in effect, what the government has done is allowing seamless internet telephony.
The Commission’s decision – which must be approved by the Cabinet – is on the basis that such a payment will entitle BWA holders to migrate to the proposed unified licensing regime and provide for a level-play field with access service providers like Bharti Airtel, since they had paid an entry fee of the same amount for providing pan-India services.
The BWA spectrum holders who entered the market after the July 2010 auctions currently hold an Internet Service Provider licence for which the fee was Rs 30 lakh.
Other pure-play BWA spectrum holders are Augere and Tikona Digital.
Infotel Broadband, a company acquired by RIL in July 2010 was the only firm which had paid Rs 12,837 crore to bag BWA spectrum in all 22 circles. The company is yet to start services but speculation has been rife that it plans to shortly embark on a commercial launch.
“The Commission broadly endorsed recommendation of the department of telecommunications committee with regard to unified licensing regime... If ISP licence holders holding BWA spectrum wish to provide voice using that spectrum, an additional fee of Rs 1,658 crore will be levied for migration to unified licences (UL),” telecom commission chairman and secretary DoT R Chandrashekhar said. The framework for new licences will be ready by end of this financial year, he added.
However, some analysts criticised the decision, pointing out that the amount of Rs 1,658 crore should have been indexed to current levels if the government was serious about levelling the playing field. This way, it is a huge benefit to companies who essentially bid for spectrum which was for data services, they said.
Auspi – a telecom industry association of dual-tech operators like Reliance Communications and Tata Teleservices – general secretary Ashok Sud said: “The BWA spectrum had a lower per MHz reserve price than that of 3G spectrum. The pan-India auction-discovered price of BWA spectrum was Rs 642 crore per Mhz against Rs 1,675 crore per MHz for 3G spectrum. 20 MHz of BWA spectrum is held by each licensee. The Telecom Commission’s reported action will allow BWA licensees to offer pan-India voice after paying a paltry incremental amount of Rs 83 crore per MHz. Given that the difference between the prices of 3G and BWA on a per MHz prices was Rs 1,033 crore per MHz, it would amount to a bonanza for BWA licensees. This is unfair to the existing unified access services licensees.”
Meanwhile, the telecom commission deferred a decision on bringing telecom tower companies, called IP-1, under licences.