The Empowered Group of Ministers (EGoM) on telecom, headed by Finance Minister, may is likely to meet on June 20 to decide on the 2G reserve price and policy for auctioning spectrum.
All issues related to 2G issued have to finalized this month and spectrum auction to be completed before the August 31 deadline set by India’s Supreme Court.
Earlier this month, the EGoM had decided to auction a minimum 10 MHZ megahertz spectrum, but stopped short of taking a decision on the controversial proposal to redistribute the 900 MHz spectrum. The panel also did not arrive at a conclusive decision on spectrum pricing and auction.
The Empowered Group of Ministers had decided to sell up to 13.75 MHz of spectrum in the 1800 MHz band in the upcoming auctions, which enables the possibility of at least two operators winning back their cancelled permits. The government can garner a minimum of Rs 49,800 crore if 13.75 MHz spectrum are sold at TRAI recommended prices.
However, the controversial proposal to refarm or redistribute the 900 MHz spectrum of existing operators was not discussed. These airwaves are primarily held by Bharti Airtel, Vodafone India and Idea Cellular, and are considered ideal for operating second-generation, or 2G,networks. The EGoM is slated to meet again this month to finalise the minimum price for spectrum.
The nine-member EGoM did not take any decision on the reserve price for spectrum to be sold in the auctions, but would stick to the August 31 deadline as mandated early by the Supreme Court.
shashank June 19, 2012 at 4:29 pm
agree with saurabh
Saurabh June 18, 2012 at 8:44 pm
TRAI recommendations of charging 2X for spectrum in 800 MHz from CDMA operators is also justified as these operators are providing 3G services i.e EVDO Rev.A and now Rev.B also with the same spectrum and haven’t pay single penny extra like GSM operators paid for 3G and yet they have priced their services like they paid thousands of crores for this. 800 MHz is precious and an efficient band and companies using it have to spent little on Infra because of its reach and penetration power.
CDMA operators actually got Goldmine by paying penny but these idiots failed to make most of it.
Saurabh June 18, 2012 at 8:35 pm
The Department of Telecom had made an Monsoon Offer for incumbent operators few days back in which they asked incumbents to pay one time license fee for the spectrum they are currently holding and also ask them to accept TRAI recommendations on spectrum pricing and in return they (DoT) assured them of legalizing 3G Intra Circle Roaming and withdraw case against them.
DoT actually followed ‘Give and Take’ policy. But as far as EGoM meeting is concerned, I (as an individual) am in favor of TRAI and want Pranab Da and other members of EGoM to go ahead with TRAI recommendations. Look, these licenses are to be given for a period of 20 years which is a long long period for recovering this cost. If it were for 10 years, I would have called base price as high but not now.
Last time when licenses were given, the telecom sector in India was not mature like it is now. If we analyze past data, the operators have actually made huge profits in 5-6 years only starting from 2003 when telecom sector gained pace. Now they have large chunk of customers alreade with them and will have complete 20 years to recover cost. Besides this incumbents have 3G spectrum till September 2030. So, they don’t have to pay extra for 3G now.
New operator’s concern regarding high base prices can be justified but Incumbents like Airtel, Idea, Vodafone and even Tata are making hue and cry.
I have analyzed the situation deeply but can’t post everything here but the outcome of that analysis is, Goverment should stand by TRAI recommendations. The actual effect will be like nothing.
shiv June 18, 2012 at 2:44 pm
in punjab vodafone has increased landline charges 2p/sec.
Amit June 18, 2012 at 2:22 pm
Now that it’s an established fact that the cartel network operators were given spectrum at throw away prices, they should be asked to pay the market price for the airwaves for the remaining period of their licences so as to create level playing field.
Sandeep June 18, 2012 at 1:54 pm
God knows how costly the spectrum is going to be and how badly its going to affect the 2g tariffs
kingston June 18, 2012 at 1:53 pm
Allowing at least 3 new PAN India operators per circle is good.. . .