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TRAI recommendations evoke mixed reactions from operators

The telecom watchdog's recommendations on allocation of spectrum for second generation (2G) telephony evoked mixed reactions from mobile phone companies today.

business Updated: May 12, 2010 21:08 IST

The telecom watchdog's recommendations on allocation of spectrum for second generation (2G) telephony evoked mixed reactions from mobile phone companies on Wednesday.

The country's top operator, Bharti Airtel, called the proposals "shocking and perverse" while Reliance Communications (RComm) found these "progressive and consumer-centric".

The Telecom Regulatory Authority of India (TRAI) on Tuesday suggested a one-time levy on service providers for holding 2G radio spectrum beyond 6.2 mega hertz. The fee calculation has been pegged to the current prices of 3G, for which an auction is going on.

Airtel in a statement said: "The recommendations are shocking, arbitrary and retrograde. We are confident that the DoT (department of telecommunications) and the government will take a rational approach and summarily reject these arbitrary, impractical and perverse recommendations."

RComm welcomed the TRAI spectrum proposals which it said would encourage rural telephony.

"The recommendations are progressive and will encourage rural telephony. Incumbent operators will have to pay up for excess spectrum and return excess spectrum. Impact on incumbent GSM operators will be close to Rs.10,000 crore. Impact on the company will be only Rs.22 crore," RComm said in a conference call.

Tata Teleservices took a different view and said the recommendations did not address the inequalities in spectrum allocation and issues of excess spectrum beyond 6.2 MHz.

"The recommendations instead of recognising our status as a dual technology UASL-holder, has rather pushed us further behind in the queue, as it now proposes to award the spectrum first to those players who already have 4.4 MHz to 6.2 MHz and then to those who have been waiting.

"The recommendations, thus, impact TTSL adversely and makes our case of expecting minimum spectrum the worst in the industry," it said.

Vodafone found the recommendations "opaque and illogical."

Industry experts said players like Bharti, Idea and Mahanagar Telephone Nigam Ltd are likely to be the most affected by the recommendations as they hold spectrum in excess of the limits mentioned in the proposals.

RComm and Tata Teleservices do not have any excess spectrum. "So impact of the recommendations on them is likely to be minimal," said one.