Spectrum not to come free with licences

In a major shift from the existing policy, the start-up spectrum of 4.4 MHz may not come free with the telecom licence that is awarded to a company.

In a major shift from the existing policy, the start-up spectrum of 4.4 MHz may not come free with the telecom licence that is awarded to a company. In its report on the pricing and allocation of telecom bandwidth, the inter-ministerial committee on spectrum has decided that it should be priced separately.

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There will be two categories of charges — a one-time charge which will be derived through auction, and an annual charge which the committee has proposed to be 3 per cent of annual gross revenues (AGR).

Presently, spectrum of 4.4 MHz band (for GSM) and 2.2 MHz (for CDMA) come free with the unified access service licence (UASL), which is required for providing mobile and fixedline services. UASLs are issued on first-come-first-served-basis. This was the main reason for the controversy in spectrum pricing.

The committee has recommended that only one operator will get the spectrum in the 2 MHz band; others will have to be content with 1MHz. Additionally, no single operator would be allowed to hold more than 25 per cent of the total spectrum available in the market.

The operators — both CDMA and GSM players — would also have to pay a uniform charge of 3 per cent of their AGRs. Presently, this charge varies for CDMA and GSM players and is linked to the number of subscribers with the service provider.