Trai Recommended Spectrum Pricing Likely to Get Approved by DCC

The DCC will meet next week to take important suggestions regarding approval of spectrum reserve prices and Wi-Fi interoperability platform

By September 9th, 2019 AT 5:44 PM
Highlights
  • Trai has not changed its reserve prices for the spectrum even after being urged by the government
  • Currently, as per the suggestion by Trai the spectrum pricing is pegged at Rs 492 crore per MHz

The Digital Communications Committee (DCC) which was previously known as the Telecom Secretary, heads the apex telecom related decisionmaking in the country now. The next most crucial decision in line for the committee seems to be regarding the 4G spectrum and 5G airwaves auction. In a new development reported by ET Telecom, the DCC might likely approve the spectrum pricing recommended by the sector regulator, the Telecom Regulatory Authority of India (Trai). The DCC will give its approval next week in a meeting which could also lead to the finalisation about the quantum of the spectrum that is to be put for auction. It is also worth noting that the upcoming spectrum sale, which will include 4G and G airwaves will be India’s biggest spectrum sale.

Trai Did Not Budge on Recommended Prices for Spectrum

A senior Department of Telecommunications (DoT) official said, “Meeting is likely on September 16. Trai’s recommendations are likely to be taken up… In all probability, they should get approved because there isn’t a way to lower the reserve price.” The DoT official also added that the department is now helpless about the reserve prices of the spectrum that are to be put up for sale in the upcoming auctions. Trai had made recommendations about the prices of the spectrum in August 2018. Even after the government asked Trai to lower the spectrum prices saying that the high prices would impair the buying power of the telcos in an already cash strapped industry, the regulator did not budge from its recommended prices.

Trai instead turned the needle towards the government saying that the government will have a big hand in making the auction a success. The regulator did not make any change to its recommended prices for the spectrum, especially for the 5G airwaves. The Trai suggestion on the airwaves pricing pegs the cost of the spectrum at Rs 492 crore per MHz. As per the telecom operators, the proposed pricing of the spectrum in India is seven times higher than that of other countries like South Korea for the spectrum in the same frequencies.

Auction to be Held in Early 2020

The DoT is willing to hold the spectrum auction by the year-end. However, it is likely the sale of the airwaves might get pushed to early 2020. It is also notable that the government will amass Rs 5.6 lakh crore if all of the spectrum is sold at the base price. The spectrum that will be put up for auction will include 4G airwaves in six bands and 5G spectrum for the first time, which will be in the 3.3-3.6 GHz band. The auctioneer is likely to be appointed by October 10.

The DCC also has a decision to take about which platform is to be chosen for Wi-Fi interoperability. As per the DoT official, this step when it goes to effect will allow the users to access any hotspot from any service provider to gain internet access. The DCC currently has suggestions from both, Trai and the industry regarding Wi-Fi interoperability platforms.

Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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