DoT forms committee to calculate separate 2G and 3G incomes

Written by Corporate Bureau | New Delhi, Sep 29 | Updated: Sep 30 2008, 07:08am hrs
Two days after the Telecom Regulatory Authority of India (Trai) raised the question of how to segregate the income generated by the 2G and the 3G services, the department of telecommunications (DoT) has constituted a committee to calculate the same.

The committee will examine that once 3G services comes into operation, whether there can be some mechanism to segregate revenues of 2G and 3G for a service provider. The committee would also study the components like voice, data and roaming would constitute a part of 3G for revenue. The latter assumes significance as the foreign players bidding for the 3G are most likely to use the 5.5 Mhz spectrum first for providing basic voice and data services traditionally provided on the 2G spectrum. Hence, the question of how to calculate the incremental revenue arising out of 3G services in such a case.

The committee was formed in the backdrop of the Trai pointing out that the recent modifications made by the DoT which state, the licensee shall pay an annual spectrum charge of 1% on the incremental revenue due to 3G services after a period of one year, since it is impossible to calculate the revenues arising out of 2G and 3G services in case of a service provider providing both the services.

The regulator had said that both the services were capable of providing triple pay services except for the fact that the 3G technology provides faster data speed, moreover there would be many common control equipment for 2G and 3G, hence appropriating the cost/revenue to the two services separately would be a complex and a cumbersome exercise.

However, the Cellular Operators Association of Indias chairman, TV Ramachandran had noted to the DoT that it was possible to calculate the revenue generated by the 2G and the 3G spectrum and was already being done in Hong Kong.