TRAI for not auctioning 2G spectrum

New Delhi, May 11 (PTI) Virtually endorsing India's
Telecom Ministry's decision not to auction 2G spectrum two
years ago, telecom regulator TRAI Tuesday said bidding out
mobile spectrum would not have yielded major economic gains
for the exchequer.
"It is not feasible to subject the spectrum in 800-900
-1800 Mhz band to auction process, considering that the amount
of spectrum after meeting the obligation of contracted
spectrum is very limited and the number of claimant for
additional spectrum would be extremely few," Telecom
Regulatory Authority of India (TRAI) Chairman JS Sarma said.
The Telecom Ministry's decision to sell 2G spectrum in
2008 at 2001 prices had become the subject of a major
controversy, with the Opposition parties alleging a scam that
cost the government Rs 60,000 crore.
The telecom regulator Tuesday released its recommendation
report on spectrum allocation and pricing.
TRAI also suggested that from now 2G spectrum (radio
waves) could be priced on par with what is discovered through
the 3G spectrum auction and also delinking the sale of
spectrum from issue of licence, as is the current practice.
Sarma added: "The authority is conscious of the fact that
there are several views about deriving the true price of 2G
spectrum and keeping this in view the authority is separately
initiating an exercise to further study the subject and would
apprise the government later, but for the present the
authority recommends that 3G prices could be adopted as the
current price of 2G spectrum."
Telecom Minister A Raja's decision to allocate mobile
licences with 4.4 Mhz of 2G spectrum at a price of Rs 1,651
crore to a host of companies that included realty player
Unitech Wireless, Videocon, Swan, prompted the allegations of
corruption.
Consequently, the CBI was roped into to look into the
allocation of giving away spectrum at rates much below the
market price.
Raising the quantum of minimum amount of spectrum
(contracted amount of 6.2 Mhz to the operators), the regulator
said: "All the spectrum beyond 6.2 Mhz will have to be paid
for at the current market price (linked to 3G price) by GSM
operators and for the CDMA operators the spectrum assigned
beyond the contracted amount of 5 Mhz will have to be paid
for."
Dealing a big blow to several existing operators like
Bharti Airtel, BSNL and Vodafone Essar, the regulator said the
service provider will have to pay an additional one time
charge for the spectrum they hold beyond 6.2 Mhz, which will
be paid at the current price of spectrum upto 8 Mhz and after
that it will be charged at 1.3 times the current price.
This would mean existing operators would have to pay 3G
rates for spectrum they hold above 6.2 Mhz.
The Big three players -- Bharti Airtel, Vodafone and BSNL
-- hold around 10 Mhz spectrum in many key circles. PTI ANA
MRD


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