The department of telecommunications (DoT) has asked the Telecom Regulatory Authority of India (Trai) to explain the rationale for capping the maximum spectrum a mobile operator can hold. In a nearly 40-page note, the DoT has highlighted its areas of difference with the regulator?s recommendations on spectrum management and licensing framework, which was submitted by the Trai in two batches ? May 11, 2010 and February 8, 2011.
Disagreeing with the main crux of the recommendation, which was pricing of the 2G spectrum, the DoT has asked Trai to reconsider it since it finds it complex. On policy matters, if the DoT disagrees with Trai, it has to refer the matter back to it for its reconsideration. The regulator has to get back with its reconsidered views within 15 days after which the DoT is free to decide its course of action.
Trai in February this year had recommended that the 2G spectrum up to 6.2 Mhz in a circle may be priced at 53% of the 3G spectrum price in that circle while spectrum beyond 6.2 may be charged at 136% the 3G price. The regulator, however attached the condition that this price would be applicable only if the government conducts the process of allocating spectrum within 12 months of the recommendations, else it must go in for auction of spectrum and adjust the price accordingly. DoT however has called the entire spectrum pricing to be ?complex? and has said that while it will not be able to hold the auction soon, Trai may determine another ?current price? for the 2G spectrum.
DoT has also differed with Trai on what is the contracted amount of spectrum under the licence. While Trai has made amply clear through its successive recommendations that the government must treat 6.2 Mhz as the threshold limit, DoT has differed. It has proposed treating 6.2 Mhz as the stipulated amount only for those who have already received the quantity and the start-up 4.4 Mhz for those operators who are yet to receive the additional spectrum up to 6.2 Mhz.
Raising doubts over the legality of priority list drawn by the regulator on whom to allot spectrum first, DoT has said that Trai’s recommendations might violate the rights of those it has placed last in the queue. The news will bring cheer to operators such as Tata Teleservices who have now been waiting for years to get start-up spectrum in Delhi. According to the regulator?s recommendation operators who seek start-up spectrum in a circle would be placed last in queue after the demand of operators seeking additional spectrum.