As the government cheers its windfall gains from the 3G-spectrum auction so far and operators keep calculating the burden on their balance sheets, it is Trai that must be losing sleep. The regulator?giving finishing touches to its set of recommendations over the allotment of the 2G spectrum to operators beyond 4.4 Mhz?is bound to draw criticism if it does not suggest auctions.
What the 3G-spectrum auction has done is discover for the first time the market price of the spectrum, which the government until now has been allocating?as in the case of 2G spectrum?to the telecom operators on the basis of achieving a predetermined subscriber base. The regulator is now left with no choice but to recommend auctions even for future allotments of the 2G spectrum and this is where the problem lies. At one end, there are the recommendations of the DoT committee, which rightly recommended that spectrum be auctioned for any future allocation beyond the bundled 4.4 Mhz for the new licensees who were awarded licences in 2008. The committee has also recommended the delinking of spectrum from licences in the future.
As reported by this newspaper on Monday, the success of the 3G-spectrum auction has indeed made other departments in the government seriously consider this as a method to sell scarce resources within their purview. Such resources range across minerals and land and even extend to liquor licences.
If the regulator goes with the flow and recommends auction of all spectrum beyond 4.4 Mhz, the new operators will cry foul as they entered the telecom sector and paid for their licences under the impression that they too would be given additional spectrum on the basis of a subscriber-linked criterion, at least up to 6.2 Mhz, like their predecessors. Hence, while recommending auctions for 2G spectrum, the regulator will have to keep in mind the issue of a level playing field. This will be a tightrope walk indeed.
anandita.mankotia@expressindia.com