The department of telecommunications (DoT) expects to allocate spectrum to satellite broadband operators such as Starlink, Eutelsat OneWeb, and Jio Satellite around December. This means that commercial rollout of services can start only in the first quarter of 2026.
The process of finalising the administrative pricing of spectrum for rolling out the services is held up as the DoT has sought clarifications from the Telecom Regulatory Authority of India (Trai) on several of its recommendations related to spectrum pricing and subsidies.
What’s the process for approval?
Once the revised inputs are received, the department will examine them and make suitable amendments, if necessary, before placing the proposal before the Digital Communications Commission for approval.
One of the most closely watched points related to the clarifications sought is the proposed use of the Digital Bharat Nidhi (DBN) fund to subsidise user terminals for satellite broadband services. Industry executives said the subsidy component is critical for ensuring connectivity in rural and remote regions where terrestrial networks cannot reach.
Without it, the high cost of satellite terminals, often ranging from Rs 20,000 to Rs 50,000, would make large-scale adoption economically unviable for most users. Trai had recommended that the government explore using the DBN fund, previously known as the Universal Service Obligation Fund (USOF), to partially offset equipment costs and promote equitable access.
The DoT, while supportive of expanding rural coverage, is said to be cautious about the fiscal implications and has sought detailed justification from the regulator on how such subsidies would be structured and targeted.
TRAI proposes charging satellite operators
In its May recommendations, Trai had also proposed charging satellite operators a 4% levy on adjusted gross revenue as the annual spectrum usage charge, with a minimum floor of Rs 3,500 per MHz. It had further suggested an additional Rs 500 per urban subscriber per year for non-geostationary operators to incentivise rural outreach.
The DoT has raised questions about the practicality of implementing the urban-rural differentiation, pointing to challenges in defining subscriber locations and enforcing such a system.
The department has also sought clarification from Trai on the adequacy of the proposed floor pricing, the five-year validity of spectrum assignments, and other conditions linked to renewal and technology upgrades. Officials said that the aim is to ensure a fair balance between government revenues and industry viability, while avoiding spectrum hoarding or inefficient usage.
Industry players are hoping for an early resolution so that spectrum allocation can begin by the year-end, enabling pilot services and commercial rollouts through 2026. Both regulators and operators recognise that satellite broadband will complement rather than compete with terrestrial networks.
