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Tag: Spectrum

  • TRAI says get spectrum from Defence, denies Govt. has no authority to ask BSNL to return unused spectrum

    TRAI says get spectrum from Defence, denies Govt. has no authority to ask BSNL to return unused spectrum

    NEW DELHI: Expressing concern that the constrained supply of spectrum poses a real threat to the continuity of services being provided to millions of subscribers by the expiry licensees, the Telecom Regulatory Authority of India (TRAI) has reiterated its earlier recommendation for a dialogue at the level of the Ministers for Finance, Communications, Defence to ensure the availability of additional spectrum for commercial use.
     
    In a letter to the Telecom Secretary, the Authority has said the non-availability of sufficient spectrum is the biggest impediment to the realisation of the stated goals in NTP- 2012 for broadband proliferation. The Authority re-emphasised the need to increase the supply of spectrum.
     
    The letter was in response to the DoT’s reference of 14 November seeking some clarifications on recommendations on Valuation and Reserve Price of Spectrum Licenses expiring in 2015-16 sent on 15 October.  
     
    There is no change in the reserve prices for spectrum in the 900 MHz and 1800 MHz bands from what were recommended earlier.
     
    The   Authority reiterated that steps should be  taken to  make available additional spectrum in  the  900, 1800 and 2100 MHz bands by  taking back 1.2  MHz of 900 MHz spectrum from BSNL,  utilising idle  1800 MHz spectrum in  the  Defence band and vacating spectrum held in excess of 20 MHz by Defence in the 1800 MHz ban.
     
    The Authority’s recommendation for the implementation of E-GSM band is one of the ways to enhance the supply of 900 MHz band spectrum which is considered by operators (the market) to be the most valuable spectrum. The option needs to be given serious consideration by the government.
     
    In the 2100 MHz band, an additional 3 blocks of 2×5 MHz of spectrum can be made available by swapping spectrum in this band with Defence which can be assigned spectrum in the 1900 MHz   band (1910-1920/1980-1990 MHz).
     
    The spectrum in the 800 MHz, 900 MHz, 1800 MHz and 2100 MHz bands should be auctioned together (simultaneously). Uncertainty would continue if auction of spectrum in the 2100 MHz is taken up later.
     
    The government should announce its decision on the adoption of APT700 band plan. It should also announce the roadmap for the auction of spectrum in 700 MHz band. This should be done before the conduct of the upcoming auctions in 900/1800 MHz band. These two decisions will help in the faster development of the device eco-system. It will also help TSPs to take an informed decision when bidding for the upcoming auction in 800/900/1800 MHz bands.
     
    The Authority had recommended that 1.2 MHz spectrum in 900 MHz band should be taken back from BSNL from all the LSAs where licences expire in 2015-16 except in Punjab. In lieu, BSNL should be assigned 1.2 MHz in the 1800 MHz band only in those LSAs where its spectrum holding in that band is less than 3.8 MHz in this band i.e. in Gujarat, Rajasthan and West Bengal. However, the DoT said it had no jurisdiction to take back spectrum from BSNL to which TRAI has said the PSUs (MTNL/BSNL) were awarded the spectrum in the 900 MHz band administratively and free of charge. Both the PSUs are government-owned companies and the government has every right to take the spectrum back from them if they are not using it optimally and efficiently. “It is inexplicable to take the stand that the government, being a sovereign and as owner of the PSU companies cannot resume spectrum given to the PSUs free of charge.” Besides, the DoT, being the licensor, has to ensure that spectrum is put to optimal use and an operator does not squat on invaluable spectrum.
     
    In this context, TRAI said it was worth recalling that being government companies, the government assigned 3G and BWA spectrum to them without their participation in the auctions. This spectrum was literally foisted on the PSUs. Later, when they just could not use the BWA spectrum, the government allowed them to surrender BWA spectrum and decided to refund the payment made by these PSUs.

     

  • Ofcom to release terrestrial TV spectrum for mobile broadband services in UK

    Ofcom to release terrestrial TV spectrum for mobile broadband services in UK

    NEW DELHI: Even as the dispute about Defence releasing spectrum continues in India, mobile broadband services in Britain will get a boost with British telecom regulator Ofcom releasing some digital terrestrial spectrum.

     

    The strategy of Ofcom is to ensure that UK’s network operators can continue to deliver mobile broadband using some of the frequencies used for digital terrestrial TV services such as Freeview, and wireless microphones. Ofcom said these frequencies make up the 700 MHz frequency band.

     

    Ofcom CEO Ed Richards said, “This important decision ensures that we are making the raw materials available with which investors and companies can build the services which will support the digital economy of the future.”

     

    Ofcom said that viewers can continue to enjoy the free-to-view TV services without another switchover. Ofcom is keeping a target of 2022.

     

    Ofcom will ensure that users — theatres, sports venues and music events – of wireless microphones will have access to airwaves to deliver cultural benefits.

     

    Some industry reports predict that demand for mobile data could be 45 times higher by 2030 than it is today.

     

    In October, Ofcom has already invited potential bidders to comment on proposals for auction of spectrum in the 2.3 GHz and 3.4 GHz bands, which is expected to take place in late 2015 or early 2016.

     

    The company has identified a number of frequency bands that wireless microphones could potentially use. Working with the PMSE community, Ofcom will confirm what spectrum will be available to them next year.

     

  • TRAI asked to rework on spectrum auction policy by Telecom Commission

    TRAI asked to rework on spectrum auction policy by Telecom Commission

    NEW DELHI: The Telecom Commission is understood to have asked the Telecom Regulatory Authority of India to rework its policy with regard to spectrum auction.

     
    The directive follows study by an internal committee of the Department of Telecommunications (DoT), which rejected the regulator’s recommendation to conduct the next round of auction after keeping enough spectrum.
     

    TRAI in its recommendations had said the government should release enough spectrum before the next round of auction which is slated to take place before March 2015. TRAI has the support of major telecom operators such as Bharti Airtel, Vodafone, Idea Cellular and Reliance Communications.
     

    The DoT internal committee has said it is not clear when additional spectrum will be vacated by the Defence Ministry. The DoT committee feels that there is no point in stalling the sale of what is already available
     

    In its recommendation, TRAI said the Defence Ministry should vacate the spectrum in the 2,100 MHz band. In addition, TRAI proposed that Bharatiya Sanchar Nigam Limited should surrender 1.2 MHz spectrum in the 900 MHz band.
     

    The amount of spectrum being put up for auction early next year is less than the 2G spectrum currently being used by mobile operators whose licenses are due for renewal and this may lead to problems, observers in the telecom industry said.

     

  • 900 MHz spectrum expected to sell for four times the reserve price: HSBC Research

    900 MHz spectrum expected to sell for four times the reserve price: HSBC Research

    NEW DELHI: Government proceeds are expected to be $ 9 billion from the upcoming spectrum auctions, 20 per cent higher than the government’s own estimates, according to a study by HSBC Telecom and Media Global Research.

     

    The research also says that it is possible that in a few markets the cost for 5 MHz of 900 band may exceed the 3G prices as well.  

     

    The estimates are 1.4 times higher than the reserve price recommended by the Telecom Regulatory Authority of India (TRAI) for 900 MHz spectrum band. For 1,800 MHz band, the estimates are 1.2 times of the reserve price suggested by TRAI, the report adds.

                                          

    Demand for data spectrum is likely to be a key driver in the upcoming spectrum auctions, if one goes by earlier auctions. At present, the two top players who are better placed to add more spectrums – Idea and RCOM – are likely to be more defensive, according to the study.

    It further noted that there is uncertainty for both investors and operators whenever there is talk of spectrum auction.

     

    The spectrum auction earlier this year saw an unexpected contest for 1,800 MHz spectrum as the entry of pure 4G players forced incumbent operators to add 4G spectrum selectively, stated the research paper.

     

    Moreover, it added that the most interesting trend has been robust data revenue growth (data revenue growth in FY14 was 90 per cent year on year for the top three players).

     

    “While this is positive, it raises the need for additional capacity spectrum (incumbent telcos are already talking about congestion particularly in metro markets with 20 per cent to 30 per cent of their BTS). Operators have so far been highlighting the need to add data footprint but in the markets where they have 5MHz of spectrum, and it will be important for them to get to 10MHz sooner than later (over the next couple of years) to accommodate data growth,” the research revealed.

     

    The study has found that ‘doubling of spectrum will more than double the throughput for telcos and in turn allow them to benefit from lower per unit costs as well with doubling of spectrum.’ 

    The need for capacity spectrum, the study said, is likely to drive prices up for spectrum in the upcoming auctions.  

     

    While both Bharti and Idea face auctions in some of their key markets, the latter has more exposure in the upcoming auctions versus Bharti. The study says this implies that telco Idea is likely to focus more in retaining spectrum in existing markets.

     

    On the other hand, the top two players Bharti and Vodafone could look at adding more spectrum in the 900 band, according to the report. HSBC was positive on Bharti with a target price (TP) of Rs 481 and Neutral on Idea Cellular with a TP of Rs 172. The key downside risk for Bharti will be losing spectrum in the 900 MHz band.  The key upside risk for Idea will be the release of additional data spectrum and the key downside risk will be losing spectrum in the 900 band. The study is somewhat negative on RCOM with TP of Rs 100 and the key upside risk for them will be ability to benefit from spectrum trading. 

  • TRAI seeks clarifications with regard to spectrum allotted to Defence

    TRAI seeks clarifications with regard to spectrum allotted to Defence

    NEW DELHI: The Telecom Regulatory Authority of India (TRAI) has asked the Department of Telecom (DoT) to clarify whether discussions with Defence to release one block of 5 MHz is for the same block which has been already auctioned in five out of 22 LSAs or the discussion would result in release of one more block of spectrum, thus, making two blocks of spectrum available
    for auction.
     
    The letter from TRAI Secretary Sudhir Gupta follows a letter received from the WPC Wing asking TRAI to provide recommendations on: (a) Applicable reserve price for 2100 MHz, 2300 MHz and 2500 MHz bands for all the service areas in both the cases, that is, spectrum available in entire service area and spectrum partially available in any service area; (b) Auction of the right to use of spectrum in a band with varying validity periods (less than 20 years) so that expiry of validity period of right to use of spectrum in a band in a service area occurs at same time.
     
    TRAI has asked the DoT to provide information/ clarifications relating to the 2100 MHz band.
     
    The WPC has informed that at present no vacant spectrum is available with the DoT in 2100 MHz band and discussions with Defence are underway for release of one block of 5 MHz of spectrum. In its recommendations on ‘Valuation of Reserve Price of Spectrum: Licenses Expiring in 2015-16’ dated 15 October, TRAI had mentioned that the DoT has assigned the fifth block of 5 MHz in the 2100 MHz band in 5 LSAs and in the remaining 17 LSAs, the spectrum is available with the DoT.
     
    The Authority in its recommendations also recommended that entire 2X60 MHz in the 2100 MHz band should be made available for commercial use. If required, Defence may be assigned spectrum in the 1900 MHz band (1910-1920/1980-1990 MHz). It was further recommended
    that this matter is of utmost importance, therefore it must be taken up at the highest level and the vacant 3G slots should be put to auction along with the spectrum in 900 and 1800 MHz bands.
     
    In the letter, Gupta says TRAI will not be in a position to go ahead with the consultation process in the absence of full information with regard to total availability of the spectrum in the 2100 MHz band. Therefore, DoT is requested to indicate the decision regarding the above at the earliest.
     
    With regard to 2300 MHz band, the auction was conducted in June 2010 and two blocks across the 22 service areas were sold. However, even after four and half years of assignment of spectrum, no Telecom Service Provider has actually done any worthwhile rollout.
     
    Therefore, the Authority would like to know if in spite of such poor utilisation of earlier auctioned spectrum even after more than four years, the DoT believes that there will be takers for this spectrum at this point of time.
     
    TRAI had in a letter on 8 March 2013 informed DoT that in ten service areas, the guard band available between the spectrum assigned to different BWA spectrum holders is just 2.5 MHz, and this may result in severe interference in asynchronous TOO networks. TSPs have also suggested that the solution to the problem of interference in such a scenario can either be achieved by use of similar frame configuration (for uplinking and downlinking) or rearranging the assigned frequencies, so as to have a wider guard band.
     
    According to the present proposal of DoT, in 6 more LSAs, the guard band between different
    TSPs will reduce to 2.5 MHz.
     
    TRAI has also said that DoT may like to inform whether any study in this regard has been conducted to examine the concerns expressed by TSPs; and if so, DoT’s decision on this issue.
     
    Referring to the 2500 MHz band, TRAI says this band is very important and unique in the sense that it provides a substantial amount of spectrum (190 MHz) that has been allocated on a primary basis in all three International Telecommunications Union regions for terrestrial mobile communication. As per ITU-R recommendations there are three recommended frequency arrangements in this band. Most countries have followed an approach aligned with ITU Option I band plan (C1). The frequency spots in 2500 MHz band as shown in the annexure to the DoT letter are at variance with the Option I band plan of ITU which may result in the non-optimal use of the spectrum for all time to come. The decision on harmonisation of this band is pending for an inordinately long time.
     
    TRAI says there is urgent need to decide the issue so that this band can be used optimally for commercial as well as strategic purposes.
     
    According to current trends, the 700 MHz/800 MHz spectrum band known as the digital dividend frequencies and these bands are the ideal complement to 1800 MHz and 2600 MHz spectrum band using carrier aggregation techniques for LTE and LTE advanced technologies. The Authority in its recommendations of 15 October 2014 has recommended that the Government should announce the roadmap for auction of 700 MHz band before conduct of the upcoming auctions. The DoT may decide whether it wants to go ahead with the auction of spectrum in 2500 MHz band before conducting the auction in 700 MHz band.
     
    The letter says that DoT may also please confirm that it would like to go for auction without harmonising the band, in spite of the aforementioned implications.
     
    Referring to the validity period of right to use spectrum, TRAI has requested DoT to inform the ‘effective date’ of spectrum assignment for both administratively-assigned spectrum and auction-assigned spectrum for all TSPs in each of the service areas. It has also been noted that rollout obligation of TSPs is linked with the spectrum assignment that has been allocated for 20 years. Changes in the validity period will disturb the rollout obligations linked with the various spectrum auctions since 2010. DoT may indicate how rollout obligations are going to be ensured, going forward.

     

  • TRAI’s Khullar lashes out at DoT for delay in giving spectrum to Airtel and Vodafone

    TRAI’s Khullar lashes out at DoT for delay in giving spectrum to Airtel and Vodafone

    NEW DEHI: The Telecom Regulatory Authority of India (TRAI) has lashed out at the Department of Telecom (DoT), noting that it is “unable to understand the reasons for the inordinate delay in the assignment of spectrum despite the clear provision in the notice inviting applications fo the assignment of spectrum and after the payment has been made by the licencees.

     

    In a letter by TRAI chairman Rahul Khullar to Telecom secretary Rakesh Garg, it has been stated that the Authority is seriously concerned that this delay on the part of WPC in assigning spectrum in the 1800 MHz band may lead to a partial breakdown of services offered by  Airtel and  Vodafone especially in Delhi, the national capital.

    This will inconvenience consumers greatly. Both these operators have around 20 million subscribers in Delhi which constitute around 45 per cent of the total subscriber base of Delhi Licence Service Area. It is apprehended that in December 2014, there will be a serious deterioration in the quality of service to these subscribers because of call drops, network congestions etc.
     
    The Authority has suggested that the DoT should immediately call a meeting of both Telecom Service Providers and arrive at a feasible solution so that consumers’ inconvenience can be avoided.
     
    At the outset, Khullar said in the three metros of Delhi, Mumbai and Kolkata, the first two CMTS/UAS licences given in 1994 are due to expire on 29/30 November 2014. These “expiry” licensees were holding spectrum in the 900 MHz and 1800 MHz band which was put to auction in the February 2014 auctions. Except Loop which did not participate in the auctions, other “expiry” licensees.  and Vodafone were successful in re-acquiring spectrum in these LSAs.
     
    In the Delhi LSA, Airtel and Vodafone, which were both having 8MHz in 900 MHz, could re-acquire only 6 and 5 MHz of 900 MHz band respectively in the auctions. Moreover, the spot frequencies now assigned to them are almost entirely different from the earlier different from the earlier assignment.  To make up for the shortfall int eh 900 MHz band, these TSPs have acquired additional spectrum in the 1800 MHz band, but it will require sufficient time to build a new network in the 1800 MHz spectrum.  In addition, in the Delhi LSA, Idea has acquired 5 MHz in the 900 MHz band, which has to be assigned to it after getting it vacated from these two TSPs.
     
    As reported by these TSPs, this whole exercise of change over of frequencies will need to be carried out in two stages. First, these TSPs will have to build a new network of 1800 MHz spectrum by putting new BTSs and augmenting the capacity of the existing ones. In the second stage, they will have to reduce their holding in the
    900 MHz band in steps and carry out swapping of spectrum andreleasing spectrum to the new entrant (Idea). Both of them will berequired to do rigorous planning and work in tandem. The above change  over  will be  a huge challenge  as all these changes are to be carried out on a live network catering to millions of subscribers and any lapse may result in service interruption and serious deterioration in quality of service.
     
    Anticipating the above challenges in mind, the Authority, in its recommendations on ‘Auction of Spectrum’ dated 23 April 2012 had recommended that the 900 MHz spectrum be auctioned at least 18 months in advance so as to enable the winning bidders to be ready with the deployment plans. According to the NIA of 12 December 2013 for the auctions of February 2014 in case of bidders whose licenses were about to expire in 2014, the effective date of spectrum assignment in 1800 MHz band, will be the preferred date of allotment of spectrum indicated by the successful bidders which in no case shall be later than date of expiry of existing licenses in the respective service area.
     
    Khullar noted that media reports had reported and Vodafone and Airtel had told the Authority that there has been inordinate delay in the assignment of spectrum in the 1800 MHz band. Vodafone says it has been assigned spectrum only on 10 October 2014, that is, after almost 8 months from the February 2014 auctions despite a number of representations to the WPC.
     
    In its representation of 16 October, Vodafone has indicated that it would require at least one week for the deployment of new frequencies assigned in the 1800 MHz band and 9 weeks for freeing up the excess 3MHz in the 900 MHz band in a progressive manner.  Subsequently, it would require another three weeks’ time for swapping of its frequencies in the 900 MHz band with Airtel.
     
    However, only seven weeks are left before the expiry of licences, Khullar noted.

     

  • TRAI brings out detailed paper on spectrum auctions

    TRAI brings out detailed paper on spectrum auctions

    NEW DELHI: The government should immediately take back the unused 900 MHz from the Bharatiya Sanchar Nigam Limited (BSNL) and from the Defence Ministry the unused spectrum in the 1800 MHz band, the Telecom Regulatory Authority of India (TRAI) has said.

    In its recommendations on “Valuation and Reserve Price of Spectrum: Licences expiring in  2015-16”, TRAI has also asked the Department of Telecom (DoT) to have a fresh look at the implementation of E-GSM band.

    The entire 2×60 MHz in the 2100 MHz  band should be made available for commercial use.
     
    The government should announce the roadmap for the auction of spectrum in 700 MHz band. This   should be done before the   conduct of  the   upcoming auctions in 900/1800 MHz band.
     
    The MHz spectrum in 900 MHz band should be taken back from  BSNL from all the   Licence Service Area (LSAs), where licences expire in 2015-16 except in Punjab. In lieu, BSNL should be assigned 1.2  MHz in the  1800 MHz band only  in  those LSAs where its spectrum holding in  that band is  less  than 3.8  MHz in  this   band that is, in Gujarat, Rajasthan and West Bengal.
     
    Unused spectrum in the Defence band should not be kept idle. In the LSAs, where spectrum assigned to Defence  in  the 1800 MHz band is  more than 20 MHz, DoT should coordinate with  Defence  for the vacation of spectrum held by Defence in excess of 20 MHz.
     
    A dialogue needs to be held at the  level of the  Finance Minister, the  Minister of Communications and IT and  the  Defence  Minister to ensure the  availability of additional spectrum for commercial use.
     
    At the outset, TRAI said the DoT had in April 2014 communicated that some of the Telecom Service Providers’ (TSPs)  licences are due to expire during December 2015  and early 2016 and sought TRAI’s recommendations on  the applicable reserve price for  all  the service areas for  auction of   spectrum in 900  MHz   and  1800  MHz   bands. After getting further information from DoT on certain points, TRAI had issued a consultation paper and received responses apart from an Open House Discussion.
     
    The Authority has highlighted that the upcoming auction is critical for the Telecom Service Providers (TSPs) whose licences are due to expire in 2015-16. In  the 900 MHz  band, only  the spectrum held by  them is av ailable for  the  auction.
     
    These licensees will have to win back this spectrum to ensure business continuity in a LSA; if they  don’t, it places the  large  investment made in  the LSAs in jeopardy. The  continuity of services to millions of customers is also  at stake. In   this    backdrop, the   authority has  emphasised  the   need  to   make available additional spectrum before conducting the  auction.
     
    TRAI now wants that the auction should be carried only after  a clear roadmap is  available for vacating spectrum in  2100 MHz  band from Defence  and in  900 MHz  band from BSNL.
     
    The   forthcoming auction  should  be  scheduled  after   the   issues  related  to supply constraints are   resolved. Auctions in  the  800 MHz,  900 MHz,  1800 MHz and 2100 MHz band conducted simultaneously.
     
    Auctions should not be held in Maharashtra and West Bengal for 1800 MHz spectrum at this stage as spectrum is  available in very  few districts in these LSAs.
     
    The authority has reiterated its recommendation that the  frequency rearrangement in the  same band, from  within the  assignments made to the  licensees, should be permitted amongst all  licensees irrespective of  whether the   spectrum is liberalised or not. However,  the  use of spectrum shall be liberalised only if the entire spectrum holding of a licensee in a particular band is liberalised.
     
    All efforts should be  made to make available spectrum in  contiguous form. In its recommendations, the authority demonstrated how  such contiguity can  be achieved in 7  LSAs in  the  900  MHz band. Nevertheless, the  entire available spectrum should be put to auction.

    Spectrum should be  put to  auction in a block size of 2×200 KHz in both the 900 and 1800 MHz bands.
     
    In  the 900 MHz band, the bidders should be required to  bid  for a minimum of
    2×3.6 MHz in those LSAs where spectrum being put to  auction is  10 MHz or more and 2×2.4 MHz in the  remaining  LSAs.
     
    Fresh valuation of  1800 MHz  spectrum for  all LSAs  is the  preferred way  to determine value and reserve price  of 1800 MHz  spectrum (and  for  900  MHz spectrum also)  for the  forthcoming auction.
     
    The  average expected valuation of 1800 MHz spectrum of each LSA should not be lower than the  price realized in February 2014 auction in that LSA.
     
    The value of  900 MHz  spectrum in each LSA  is  subject to  condition  that average expected value in  LSA should not   be  more than  twice  the  value of
    1800 MHz spectrum in that LSA.
     
    The reserve price for  1800 MHz spectrum in Rajasthan LSA should be fixed  at a discount of 30%  on  the reserve price calculated due to availability of partial spectrum (as was done in  the February 2014 auctions).
     
    The   forthcoming auction  should  be scheduled after the issues related to supply constraints are  resolved. Auctions in  the 800 MHz, 900 MHz, 1800 MHz and 2100 MHz band conducted simultaneously.

    Spectrum should be  put to  auction in a block  sjze  of 2×200 KHz in  both the
    900 and 1800 MHz bands.

    In  the 900 MHz band, the bidders should be required to  bid  for a minimum of 2×3.6 MHz in those LSAs where spectrum being put to  auction is  10 MHz or more and 2×2.4 MHz in the  remaining  LSAs.
     
    Fresh valuation of  1800 MHz  spectrum for  all LSAs  is the preferred way to determine value and reserve price of 1800 MHz  spectrum (and for 900  MHz spectrum also)  for the  forthcoming auction.

    The  average expected valuation of 1800 MHz spectrum of each LSA should not be lower  than the  price realized in February 2014 auction in that LSA.
     
    The value of  900 MHz  spectrum in each LSA  is  subject to  condition  that average expected value in  LSA should not   be  more than  twice  the  value of 1800 MHz spectrum in that LSA.
     
    The reserve price for  1800 MHz spectrum in Rajasthan LSA should be fixed  at a discount of 30%  on  the reserve price  calculated due to availability of partial spectrum (as was  done in  the February 2014 auctions)
     
    To  accelerate the pace of investment, and to give  a fillip  to  the  penetration  of telecom services, the   reserve price   for  North   East LSA has been fixed   at a discount of 50%  on  the  reserve price  calculated.
     
    The Recommended reserve prices for 1800 MHz and 900 MHz spectrum are  as tabulated  below.
     
    RECOMMENDED RESERVE PRICE (PER MHz)
     
    (Rs  in crore)

     

    Orissa    c    23    47
    *Reserve Price   not   recommended as spectrum is available in very few districts of LSA.
     
    @ 900 MHz spectrum is not available j  not likely to be available in  Delhi, Mumbai, Kolkata and J&K  LSAs.  Hence, the reserve price has not been g1ven.

     

     

  • “DoT should regulate carriage and I&B can look at content”: Rahul Khullar

    “DoT should regulate carriage and I&B can look at content”: Rahul Khullar

    NEW DELHI: The Telecom Regulatory Authority of India (TRAI) chairman Rahul Khullar has once again spoken loud and clear. The 62-year-old Khullar has proposed that while the Department of Telecom should exclusively focus its attention on carriage and carriage related issues while the Information and Broadcasting Ministry (I&B), considering its history, should be only regulating content.

     

    “And I think that is the way we need to go,” he said while addressing the gathering at the recently concluded CII Big Summit 2014.

     

    He also came down heavily on the politicians and political parties. He said, “The Supreme Court through its ruling has clearly stated that airwaves are not the monopoly of the state.”

     

    So, while Prasar Bharati must exist and it must be independent; politicians, governments, state governments and their organs have “absolutely no business whatsoever to be in broadcasting space,” he announced and suggested that the government must announce this as an integral part of the National Media Policy.

     

    Khullar also gave his perspective on the other components of the National Media Policy. “Firstly, there must be a clear articulation that we want a free media, unhampered and unrestricted by the government in any way possible,” he said while also suggesting that the media itself must be subject to safeguards. “It could come from other forms of independent regulators. You cannot have an institution which has rights but no duties,” he added.  

     

    Secondly, there must be commitment in National Media Policy to uphold plurality of views and opinion. “And this must be a commitment,” he said.

     

    Thirdly, time has come that we start talking about infrastructure. “If this National Media Policy is actually going to work, are we or are we not going to be in a digitised world? We cannot be flipping and flopping the dates as we send out wrong signals to the rest of the world about your credible commitment towards any policy,” he stated.

     

    Khullar also pointed out the issues with spectrum availability. “It is a nightmare to deal with ISRO. The organisation neither gives you a transponder nor does it allow you to get a transponder of your own,” he informed.  

  • TRAI wants to know if methods used for earlier spectrum auctions need change

    TRAI wants to know if methods used for earlier spectrum auctions need change

    NEW DELHI: The Telecom Regulatory Authority of India (TRAI) wants to know from stakeholders if additional spectrum in contiguous form in the 900 MHz and 1800 MHz band should be made available and whether only contiguous blocks of minimum 5 MHz spectrum should be put for auction.

     

    In a consultation paper on Valuation and Reserve Price of Spectrum: Licences expiring in 2015–16 issued today, TRAI has also asked what the block size should be to auction the spectrum in (a) 900 MHz band and (b) 1800 MHz band.

     

    The paper, which poses several questions for stakeholders, has to be replied to by 8 September with counter-comments if any by 15 September, after which an Open House would be held on the issue on 22 September in Delhi.

     

    The paper has been issued following a query by the Department of Telecommunications in April this year.

     

    Stakeholders have been asked to give views on what should the minimum quantum of spectrum in the 900 MHz and 1800 MHz band that (a) a new entrant and (b) an existing licensee should be required to bid for.

     

    It also wants to know if the licensee whose licences are due for expiry in 2015 and 2016 should be treated as an existing licensee or as a new entrant and should the valuation exercise for 1800 MHz spectrum be undertaken afresh for all the 22 LSAs.

     

    TRAI wants to know if the prices revealed in the February 2014 auction for 1800 MHz spectrum auction be taken as the value of 1800 MHz spectrum for the forthcoming auction in the respective LSA, and whether it would be appropriate to index it for the time gap (even if this is less than one year) between the auction held in February 2014 and forthcoming auction.

     

    The regulator wants to know the criteria for defining a ‘market clearing price’ and whether the valuation of spectrum and determination of reserve price should be done only for those LSAs where market clearing price was not achieved for 1800 MHz spectrum in February 2014 auction.

     

    Should the auction determined price for LSAs where market clearing price was achieved in February 2014 be taken as equal to the value of spectrum and should the market determined price be taken as the value of spectrum in all LSAs, TRAI wants to know.  

     

    It also wants to know the value of spectrum in the LSAs where market clearing price was not achieved by correlating the sale prices achieved in similar LSAs where market clearing price was achieved with known relevant variables.

     

    Should the value of spectrum in 1800 MHz band be assessed on the basis of producer surplus on account of additional spectrum, and is there any need for a change/revision of any of the assumptions adopted by the Authority in producer surplus, asks TRAI.

     

    It also wants to know whether the revenue surplus approach should be used to arrive at the value of 1800 MHz spectrum and should the values contained in the report of 8 February 2011 for spectrum up to 6.2 MHz be incorporated after indexation in the calculation of the average value of the 1800 MHz spectrum in the current exercise.

     

    Would it be appropriate to value 1800 MHz spectrum as the simple mean of the values thrown up in all the approaches and should the value of 900 MHz spectrum be derived on the basis of the value of 1800 MHz spectrum using technical efficiency factors (1.5 times and 2 times), it wants to know.

     

    Can there be any other method that could be used for arriving at the valuation of the 900 MHz spectrum, it asks. 

  • Cancel all Reliance Jio Spectrum licences, says CAG

    Cancel all Reliance Jio Spectrum licences, says CAG

    NEW DELHI: The nationwide broadband spectrum allocated to Infotel Broadband Services, now a Reliance Industries company, should be cancelled for allegedly rigging the auction and violating rules, says the Comptroller and Auditor General (CAG).

    In a draft report sent to the Department of Telecom for comments, CAG said, “The DoT failed to recognise the tell-tale sign of rigging of the auction right from beginning of the auction” in which a small ISP, Infotel Broadband Services (IBSPL) emerged winner of pan-India broadband spectrum by paying 5,000 times of its networth.

    The draft report says IBSPL which is ranked 150th in the list of ISP submitted an earnest money deposit of Rs 252.50 crore “through the covert and overt assistance of third party/private bank”, bid for Rs 12,847.77 crore (5000 times of its networth) for pan-India spectrum and then sold the company on the day of completion of the auction.

    According to the draft report, these “indicated IBSPL’s collusion and sharing of the confidential information with a third party in violation of auction conditions/rules.”

    According to news agency reports, the Mukesh Ambani-promoted RIL, which acquired IBSPL within hours of it winning the spectrum and later renamed it Reliance Jio, outrightly rejected any suggestion whereby spectrum was acquired in any manner other than through a transparent bidding process duly supervised by the Government. It also noted that this was not the final report as the DoT had not sent its comments.

     

    An RIL spokesperson said the auction for the BWA spectrum was one of the most competitive auctions in the Indian telecom history which fetched final bid price more than six times the reserve price for the pan-India spectrum.

     

    On bank guarantee, the spokesperson said according to the NIA, bidders were required to submit bank guarantee for desired amount as earnest money deposit (EMD) along with its application. “EMD was based on specific deposit requirement for each telecom circle. Accordingly, IBSPL submitted a bank guarantee of Rs 253 crore in format as prescribed in NIA. Since no money was deposited as EMD, the question of source of deposit does not arise,” the spokesperson said.

     

    The draft CAG report said, “Due to inclusion of inadequate eligibility criterion for participation in the auction, the promoters of the IBSPL enriched themselves and made unfair gain.” 

     

    CAG rejected DoT’s response that the eligibility criterion for participation in the auction was finalised after due diligence and on sector regulator TRAI’s recommendations saying it was the department’s responsibility to ensure that only serious ISPs participated in the auction.

     

    DoT in its response admitted that there was no eligibility criterion with respect to minimum net worth or paid up capital for participation in the auction.

     

    “Neither the top management of the DoT nor the important committees could detect these tell tale signs of collusion and sharing of confidential information by the biggest bidder, a tiny Internet Service Provider (ISP).

     

    “The IMC (inter-ministerial committee) did not satisfy itself as to how the IBSPL, a company with a networth of Rs 2.5 crore, would be able to pay the bid amount of Rs 12,847.77 crore within ten days,” it said.

     

    CAG in the report said, “The government should get the matter investigated even at this juncture, fix responsibilities on the bidders, which violated the auction conditions/rules prescribed and cancel the allotment of the BWA spectrum along with exemplary punishment on the colluding firms.”

    The CAG estimated that the decision of the government to allow an ISP licence holder having BWA spectrum to provide voice services against payment of Rs 1,658 crore resulted in undue advantage worth Rs 22,842 crore to Reliance Jio.

    The DoT has said the auction rules allowed all kinds of telecom operators to participate in auction and there were no inherent limitation in providing voice service using BWA spectrum.

    “Had the successful bidder of pan-India BWA spectrum obtained UAS licence (permits held by mobile phone service providers), he would have become eligible to use BWA spectrum to provide any of the service permitted under UASL including full mobile service,” the official source said.

    Telecom operators like Bharti Airtel, Idea Cellular, Vodafone, Aircel etc hold unified access service licence (UASL) that allows them providing full mobile phone services as well.

     

    The BWA auction rules gave option to participants to procure BWA spectrum under UASL against payment of Rs 1,658 crore as paid by other operators but there was no guarantee of giving them initial spectrum as was given to incumbents.

     

    CAG has rejected logic of DoT saying that auction guidelines linking of BWA spectrum with UASL is “unfair and highly inappropriate.” 

     

    According to the draft audit report, the IBSPL promoter director went on electronic media on June 11 2010 to confirm that they had been in talks with RIL during the course of auction process.

    The report said it was in ‘gross violation of the confidential clause of NIA which had prohibited bidders and insiders from conveying any confidential information to any other person, including any other bidder or its insiders.’

     

    The CAG has also indicted telecom regulator Telecom Regulatory Authority of India (TRA) for not giving clear recommendation and remaining a passive observer when changes were made in its suggestion to reduce quantum of spectrum in auction.

     

    TRAI in 2006 had recommended to make available spectrum for entry of 12 players but finally only two blocks of spectrum were put for auction that restricted scope for entry to only two pan-India players.