A delay in holding auction for 3G (third generation telecom) and broadband wireless access spectrum looks imminent with concerns being raised by stakeholders and others.
NEW DELHI: A delay in holding auction for 3G (third generation telecom) and broadband wireless access (BWA) spectrum looks imminent with concerns being raised by stakeholders and others.
The full Telecom Commission is scheduled to meet today to deliberate on the issue of 3G and BWA auction, even as the Department of Telecommunications (DoT) has already issued the information memorandum on the modalities of the auction process.
3G auction is scheduled for January 16.
BWA bidding will happen two days after that. The telecom industry, including GSM and CDMA operators, has sought multiple clarifications from DoT on various aspects of the 3G auction.
The players claim DoT had hurriedly brought out the information memorandum and suggest it devote more time to clarifying issues related to the auction process.
Meanwhile, a public interest litigation (PIL) has been filed in the Delhi High Court by the Indian Broadcasting Foundation and a few internet service providers such as Sify and Tulip against auction of BWA spectrum in the 2.5 GHz band.
The complainants have argued that they have existing operational links in that frequency band, which cannot be vacated as they are serving many subscribers. Another bone of contention is the recommendation of the Telecom Regulatory Authority of India (Trai) that an annual administrative charge equivalent to 2% of the highest bid must be paid by the 3G players. DoT has not made this a part of its information memorandum on 3G and BWA auction, and is not even keen to include it in future.
Also, many in the industry feel this is not the right time to hold 3G auctions as the players are faced with economic slowdown. Vodafone wrote a letter to the DoT to this effect recently, and many foreign players want to join the 3G bandwagon in India through the mobile virtual network operator route once it is allowed in the country. Even if there is an auction, the bid price would be much lower than expected, experts said.
However, for the government, it is important to raise funds ahead of the general election slated for April-May 2009.
Cellular Operators Association of India (COAI) director general TV Ramachandran has sought equal opportunities and level-playing field principles in the allocation of 3G spectrum. He has said that 3G spectrum must be allocated simultaneously to all successful bidders for ensuring “adequate and healthy competition in the sector.”
According to Ramachandran, if the slots for 3G spectrum are limited, it could significantly distort the bidding process, and consequently the market, as it could lead to unrealistic bids for 3G spectrum.
In case equitable distribution of spectrum is not possible due to scarcity of the natural resource, COAI has suggested alternate formulae for the auction.
Association of Unified Service Providers of India (AUSPI) secretary general S C Khanna has asked for clarifications on the timetable for auction of spectrum in 800 MHz, 1900 MHz and 450 MHz bands for a level-playing field for CDMA operators.
AUSPI has also asked for clarity on the existing quantum of spectrum and the value of entry fee for getting the unified access licence for standalone 3G operators.
As of now, two circles have been left out of the 3G bidding process completely, and in other circles, there are a varying number of slots available for private players.
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