There is a twist in the spectrum story.
Tata Teleservices has become the first company to surrender excess spectrum as it did not want to pay the price for airwaves beyond the mandated 2.5 Mhz at market rates.
The government has imposed a market price for companies that are holding spectrum beyond their contractual limit. For CDMA service providers, the pan-India price for CDMA spectrum is Rs. 9,000 crore.
"Tata Teleservices, under protest and without prejudice, has intimated its decision to the department of telecommunications (DoT) to surrender spectrum in the CDMA 800 MHz (band) beyond 2.5 MHz in all circles except Mumbai and Delhi," the company said in a statement.
"In these two metros, the company will retain one additional carrier (1.25 MHz) beyond 2.5 MHz for the balance period of licences. The company is looking to deploy additional capex to offset the reduced spectrum availability."
Sources said the company paid Rs. 63 crore to DoT for excess spectrum in the two metros.