Spectrum policy: RComs gain is Bharti and Vodafones loss

Written by Vrishti Beniwal | Rishi Raj | New Delhi, Oct 19 | Updated: Oct 20 2007, 06:18am hrs
With the department of telecommunications (DoT) accepting the Telecom Regulatory Authority of Indias (Trai) recommendations for raising the subscriber base limit for operators by 2-5 times to be entitled to get additional spectrum across circles, new entrants and the ones in queue will gain as against the established pan-India players like Bharti Airtel and Vodafone Essar.

The biggest gainer, however, will be Reliance Communications Ltd (RCom) with the DoT allowing firms to use multiple technologies to provide services.

RCom, HFCL, which provides CDMA services in Punjab and Shyam Telelink, which is a CDMA operator in Rajasthan, had applied for GSM spectrum last year.

With the new policy in place, only Bharti Airtel will qualify for additional spectrum in Delhi. However, Idea Cellular, Vodafone Essar and Aircel will benefit in circles where they have the licence but are yet to start services in the absence of grant of spectrum.

However, they will lose out to RCom in priority because its application for spectrum was submitted in February 2006, which was earlier than the three GSM companies.

At present, a GSM operator having 2.1 million users in Delhi and Mumbai circles is entitled to 15-Mhz spectrum subject to availability.

Currently, Bharti Airtel and Vodafone Essar have 10 Mhz spectrum each in these two circles. While Bharti has a subscriber base of 3.54 million in Delhi and as per the present norms is entitled for additional 5 Mhz spectrum. However, the new norms raises the limit from 2.1 million to 5 million, as a result of which Bharti would get additional spectrum of only 2.4 Mhz in Delhi.

In Mumbai Bharti will not get any extra spectrum as its subscriber base is at 2.13 million as against the revised requirement of 3 million for 12.4 Mhz and 5 million for 15 Mhz.

Vodafone Essar, which has 2.90 million subscribers in Delhi as well as Mumbai currently qualifies for additional 5 Mhz spectrum in these two circles but with the revised norms would get nothing.

COAI, which had criticised the Trai recommendations, has said that it would challenge the move in Telecom Disputes Settlement and Appellate Tribunal (TDSAT).

Meanwhile, RCom welcomed the new initiative of DoT stating that it would ensure further acceleration of tele-density in India and create a level playing field.

The company on Friday paid Rs 1,651 crore required for starting GSM services.