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Trai issues consultation paper on spectrum auction

india Updated: Mar 08, 2012 18:18 IST
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New Delhi

Inching closer towards auction of spectrum, sector regulator Trai has issued consultation paper on auction of spectrum to seek views of various stakeholders and then give its recommendation to the Department of Telecom.

"On the basis of the comments received from the stakeholders on the preconsultation paper and considering the international practices, the draft consultation paper on 'auction of spectrum' has been prepared," Trai said in a statement issued late Wednesday.

The key issues raised in this paper are amount of spectrum to be auctioned, liberalisation and reframing of spectrum in 800/900 MHz bands, structure of auction, spectrum block size, eligibility criteria for participating in the auction, reserve price, roll out obligations, spectrum usage charges and trading.

The consultation paper shows 60 Mhz and 413.6 Mhz of spectrum will be vacated in 800 Mhz and 1800 Mhz spectrum bands respectively from the cancellation of 122 2G licences by Supreme Court.

However, most of the telecom service area do not have quantum of spectrum chunk even for a single new entrants that has been decided by government for allocation under new National Telecom Policy.

The new prescribed limit on spectrum assigned to a service provider is pair of 8 MHz and 5 MHz for GSM and CDMA technologies for all service areas other than in Delhi and Mumbai where it will be 10MHz and 6.25 MHz paired spectrum.

Apex decision making body of DoT, Telecom Commission has also approved National Telecom Policy 2012 on Wednesday. This will be now send by DoT to the Cabinet for its approval.

Telecom Commission Chairman R Chandrashekhar told PTI that the NTP 2012 will be send to the Cabinet by end of this month and expected to get Cabinet approval by April.

Based on the new prescribed limit for spectrum allocation and as shown in this consultation paper of Trai, 1800 Mhz spectrum band has spectrum available that can accommodate new player, except in Rajasthan which will have only 3.2 Mhz spectrum available after it is vacated telecom operators whose licence has been cancelled by the apex court.

However, Trai has earlier recommended that on renewal of the licence, spectrum held by a licensee in the 900 MHz band shall be replaced by assignment of equal amount of spectrum in 1800 MHz. The 900 Mhz is capable of providing 3G services more efficiently compared to the spectrum in 1900 Mhz band.

In the consultation paper issued, Trai has put forward various models that can be used for auction. Similarly for deciding minimum value for spectrum to start auction, Trai has not specifically indicated price but has asked for model that should be used for determining the base price.

Most of the Telecom operators, whose licence has been cancelled by Supreme Court, have asked for fixing it at around Rs 1,658 crore which is equivalent to the licence fee that has charged for allocation of pan-India licence to new telecom players after 2001.

Trai has given time till March 21 for written comments and March 28 for counter-comments on this consultation paper.