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Telco heads spar over spectrum

There were fireworks at a closed-door meeting between IT and communications minister Kapil Sibal and leaders of the telecom industry on Tuesday, as honchos were divided on the government's proposed spectrum allocation regime, Manoj Gairola reports.

india Updated: Jan 26, 2012 01:15 IST
Manoj Gairola

There were fireworks at a closed-door meeting between IT and communications minister Kapil Sibal and leaders of the telecom industry on Tuesday, as honchos were divided on the government's proposed spectrum allocation regime.

Pitted against a well-known old-guard incumbent was one late GSM telephony entrant and new operators. The key issues at stake that resulted in a verbal duel were about the pricing of the spectrum held by incumbent leaders.

"The fight between the two reached to such an extent that finally one said that this group (meeting the minister) does not represent the views of the entire industry as a large number of operators are not present," a highly placed source present at the meeting told HT.

Later entrants in GSM telephony want the incumbents to pay for any spectrum beyond the start-up 4.4 Mhz- just like themselves, though the Telecom Commission's decisions specify that incumbents start paying only after 6.2 Mhz.

Leaders of telecom companies including Sunil Mittal, chairman of Bharti Airtel, and Anil Ambani, chairman of Reliance Communications, had met the minister to discuss issues related to the industry after the commission's approval of the policy guidelines including norms for merger and acquisition of operators and pricing of spectrum. Top officials of Vodafone, Idea cellular and Tata Teleservices were also present.

One key difference was on the issue of refarming of spectrum. The old operators were allotted GSM spectrum in the 900 MHz band, while the new operators were allotted the 1800 MHZ band. It costs more to set up infrastructure in the 1800 Mhz band. Late entrants want new operators also to use the 900 Mhz band.

The companies who were not present include Bharat Sanchar Nigam Ltd, Mahanagar Telephone Nigam Ltd, Aircel, Unitech Wireless, Sistema, Videocon, Etisalat, and S Tel.