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Licence fee should not consider handset price: TRAI

TRAI has asked Govt to keep the mobile handsets offered by telecom operators out of the ambit of calculation of their licence fee.

business Updated: Oct 13, 2003 12:50 IST

Telecom Regulatory Authority of India (TRAI) on Saturday asked the Government to keep the mobile handsets, offered by telecom operators, out of the ambit of calculation of their licence fee.

"Today if an operator buys or sells handsets, it is added to his turnover for the purpose of calculation of licence fee (revenue share). We have sent recommendations to Department of Telecom (DoT) that if operators buy and sell handsets, it should not be added to turnover for calculation of licence fee," TRAI chairman Pradip Baijal told reporters on the sidelines of a FICCI seminar on spectrum management in New Delhi.

The removal of such a clause would enable operators to get a better deal from manufacturers, he said.

"Then, like in other countries, the operators can offer handsets along with tariffs plans," Baijal said.

Earlier while addressing the 'open house' on spectrum management organised by FICCI and DoT, Baijal castigated the industry for their statements that spectrum shortage was solely responsible for customers' complaints of congestion and lack of service quality, and asked operators to learn from the Chinese market.

"China has 250 million mobile customers supported on about 50 MHz spectrum. This means, in China 5 million users are on 1 MHz spectrum. In India there are 1 lakh users for 1 MHz spectrum. We have not yet reached a stage where available spectrum cannot give excellent service," he said.

First Published: Oct 13, 2003 12:50 IST