Mobile Operators Opposes TRAI’s High 2G Auction Base Price, Call Rates May Rise upto Rs.5 Per Min

After burning hands in the 2G and 3G spectrum allocation, India’s Mobile service operators are now standing more to lose. Most of operators have opposed sectoral regulator Telecom Regulatory Authority of India’s (TRAI) recommendations of a base price for auction of 2G spectrum that is higher than the 3G price set in 2010.

TRAI’s move may also hurt Uninor (Telenor) and MTS India (Sistema Shyam Teleservices) which had lost 2G licences after SC canceled 122 licences awarded by Ex telecom minister A.Raja and were planning to rebid. Even leading mobile service providers like Vodafone India & Bharti Airtel which have been around since 1994, could be hit.

Some telecom experts who are unhappy with the TRAI’s recommendations says if mobile service providers were to start charging for the kind of bids at high rates, mobile call rates for Local and National may go up to Rs.2 to Rs.5 per minute from current tariff as low of 30p to 50p per minute.

In first reaction on TRAI’s recommendations, country’s leading mobile service provider Vodafone India said in a official statement ” We believe that several of these recommendations are retrograde and if accepted, will do irreparable harm to the industry. It will hamper the ability to connect the unconnected and goes against the objectives of National Telecom Policy of ensuring improved rural tele-density and right to broadband.”

GSM and CDMA operators association – COAI and Auspi issued a joint statement criticizing TRAI’s recommendations “Trai’s actions seem to be directed towards creating unnecessary constraints for the sector, overlooking the universal rules of sustainability and growth for this sector. Under such inconsistent, regressive and uncertain regulatory environment, it is inconceivable that the telecom industry, which is already in a state of doldrums, will be able to deliver on the Government’s vision of affordable communications, rural penetration and roll-out of data services.”

However, TRAI Chairman JS Sarma said that Telcos have to utilize spectrum efficiently, high quality spectrum cannot come cheap. We have liberalised the spectrum, therefore it is capable of taking up any technology and you are not constrained by GSM technology. So, that is the reason why we have done that.”

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57 Comments on "Mobile Operators Opposes TRAI’s High 2G Auction Base Price, Call Rates May Rise upto Rs.5 Per Min"


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August 8, 2012 12:57 pm 12:57 PM

what will u do if all of tem pool inside

Asit Paul
August 7, 2012 4:47 pm 4:47 PM

Spectrum is a natural resource. UPA or TRAI has not invented it. So the base price should be low. Let Auction decide the Maximum price.

What the hell with this UPA and TRAI? Why they sucking blood of common men? Mobile is not a fancy product now, its an essential for day to day life. If base price are high, telecos will pass it to consumers and ultimately the common men will suffer.

April 27, 2012 5:12 pm 5:12 PM

Great analysis Siva 🙂

April 27, 2012 6:19 am 6:19 AM
Emad : The Salary of TRAI employees should be decreased in the interest of country growth because a man who spends 23 Rupees Per Day is not poor. So Salary of MR. J Sarma Should be not more than Rs.690 /- Than only he can serve the country well a man who spends 23 Rupees on food how he can talk a few minutes at the cost of his dried bread in famine of India. Once upon a time there was a poor family. Husband, wife and their children were too poor. They had only one servant, Gardner, driver, Gaurd… Read more »
Keshav Jha
April 26, 2012 12:23 pm 12:23 PM

It seems TRAI has gone totally mad… Why should Indian pay more for their own resources??? Why GOI wants so much money from us??? It looks like we will have to drive someday our own car by paying fare to GOI… Our resources should be used for welfare of us not for looting us…

April 26, 2012 12:20 am 12:20 AM
i’m not experienced in this field …My doubt is whether bsnl hs 2 pay anything for spectrum..if not they can provide cheap call rates…. tis all r ti looters [airtel,voda ,idea ] trick to panic ppl….As pep our pri minister market wil decide the price …anyway new comers like docomo,aircel,reliance will get a chance to compete …tis many days wilth low arpu they struggled& sustained…they hv investedlot of money in bulding up infrastructure,licence fee ,bribe ..etc…etc… nw tis biggies only need to renew their licence..let them pay …. i even rembember when escotel [nw idea cellular] started their service in… Read more »
April 25, 2012 10:23 pm 10:23 PM

the govt has gone mad since a raja was sent to cbi investigation the govt is trying to retaliate its ex minister fault to recover losses from the comman man the best option for the operators at this point of time is not to participate in the auction process

April 25, 2012 10:10 pm 10:10 PM
This is a misconception spread by the telecom companies that if 2g spectrum is sold at such a higher rate call rates can not be restrained to present levels…..actually leading companies like voda(previously essar and hutch) and airtel have been operational since the very start of the telecom boom in india and they have made billion of bucks since then…..also they have already built a vast telecom infrastructure over this period of time…so they need not spend on equipments….their only expense is licensen fees, equipment maintenance & operation and the wages that they give to their employees……with 25k odd ppl… Read more »
April 25, 2012 8:53 pm 8:53 PM

Well said. We have to stand in queue to make STD call during half and quarter rate !!!!. Olden days are going to come.

April 25, 2012 8:30 pm 8:30 PM



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