Airtel misleading DoT on one-time charge, alleges Auspi

Written by Rachana Khanzode | Mumbai | Updated: Jul 16 2010, 05:37am hrs
The Association of Unified Telecom Service Providers of India (Auspi) has stated in a letter to telecommunications minister A Raja that Bharti Airtel is trying to mislead decision makers on the on-going issue of one-time charge for holding excess spectrum beyond the 6.2 Mhz.

In response to Sunil Mittals statement that the telecom regulator Trai has been lopsided by recommending 'one-time charge' linked to the price of 3G spectrum, the CDMA service providers representative has said Airtel should surrender the excess spectrum if it does not wish to pay excess charges. The initial start up spectrum can be given to one of our members, Auspi secretary general SC Khanna stated.

Mittal had stated that Bharti has been paying extra spectrum charges on the additional spectrum for years now and there is no rationale for onetime charge for any spectrum held by the firm.

Auspi responded to it by saying that the one-time charges for excess spectrum and spectrum usage charges are two different levies. An operator needs to pay two separate charges which is entry fee for acquiring license & spectrum and payment of spectrum usage charges as a percentage of the AGR paid on quarterly basis. Auspi stated that the spectrum charges which are being referred by Mittal are spectrum usage charges towards royalty payment for the use of cellular spectrum.

The government would garner around Rs 4,000-5,000 crore from mobile operators including Airtel, Vodafone Essar and Idea Cellular by imposing a one-time fee for those who are holding spectrum beyond the threshold limit of 6.2Mhz, a step that is being discussed for over two years now. With the additional spectrum in place, incumbent GSM operators have been using spectrum inefficiently leading to savings in capex and operating expenditure of about Rs 30,000 crore, Auspi said. Bharti holds a total of 21.4 Mhz of additional spectrum across 9 circles, Vodafone has 20.2 Mhz across 7 circles and Idea Cellular around 12.6Mhz across 6 circles. Telcos holding spectrum above 6.2 MHz up to 8 MHz will have to pay a one-time charge, at the 3G spectrum price. Above 8 MHz, fees will be 1.3 times the 3G price. Trai has also proposed a maximum of 10 MHz for operators in Delhi and Mumbai. BSNL serves 20 out of 22 telecom circles, except Delhi and Mumbai which are served by MTNL. Out of these, BSNL holds 10 MHz each in 15 circles. MTNL holds 12.4 MHz in Delhi and Mumbai. These recommendations were strongly criticised by existing mobile operators, including Airtel, Idea and Vodafone. They would have to pay a huge amount if the Trai recommendations were accepted by DoT.