Telcos must bid for extra 2G spectrum
The telecom sector is set for major policy changes as communications and IT minister Kapil Sibal has given the green signal to the Telecom Commission’s decision to auction 2G spectrum beyond the stipulated 6.2 MHz for incumbent GSM players. Manoj Gairola reports. Clearing the airindia Updated: Jan 20, 2012 02:18 IST
The telecom sector is set for major policy changes as communications and IT minister Kapil Sibal has given the green signal to the Telecom Commission’s decision to auction 2G spectrum beyond the stipulated 6.2 MHz for incumbent GSM players.
But they will have to bid in auctions to get more.
Highly-placed government sources said that under new policy guidelines that are up next for cabinet approval, telecom operators will be permitted mergers and acquisitions under an automatic route without special approvals if the combined entity does not commanda more than 35 per cent market share - both in terms of number of subscribers and revenues.If the merged entity has a share higher than this, it would be allowed subject to it meeting some parameters that will be decided by the Department of Telecommunications (DoT).
The new guidelines will now be sent to the cabinet for its approval.
Currently, incumbent mobile service providers including Bharti Airtel, Idea Cellular and Vodafone hold spectrum beyond 6.2 MHz However, they have not paid any one-time charge for it. Now they will have to.
The one-time fee will be determined through an auction. The Telecom Regulatory Authority of India (TRAI) will be asked to formulate guidelines for the auction.
Earlier, the regulator had calculated the spectrum price on the basis of the 3G spectrum auction held in 2010, which was open for all the operators.
If that price is any indication, incumbent operators would have to pay between them about R 18,000 crore for the additional spectrum that they hold.
The new guidelines also spell out the norms to allocate spectrum for both incumbent and new operators. This has so far been a grey area, full of holes and lacking transparency.