Anil Ambani switches to 900 MHz

Upping the ante in the ongoing spectrum war, Reliance Communications Chairman Anil Ambani has shot off a missive to the Department of Telecommunications (DoT), accusing GSM operators of having cornered spectrum under the valuable 900 MHz.

The latest salvo follows two letters by Ambani to the prime minister -- on November 6 and 19 -- accusing GSM operators of garnering spectrum over and above their entitlement.

Ambani has said in his latest letter that the GSM operators have "pre-emptively cornered spectrum in the more valuable 900 MHz frequency, as opposed to the 1800 MHz".

This, apart from holding on to the valuable spectrum, also gives them an undue advantage as the lower band of spectrum requires less capital expenditure (capex), sources close to the development said.

Ambani quotes estimates by experts and says that there were savings in capex of around 50-70 per cent for an operator using the spectrum in 900 MHz, as compared with the 1800 MHz band.

A Reliance Communications spokesperson and DoT officials declined to comment.

GSM operators provide services on bandwidths between 900 MHz and 1,800 MHz and it is cheaper to provide services on the lower bandwidth. This is because shorter wavelength covers a longer distance, enabling operators to place base transceiver stations (BTS or towers) at an increased distance rather than in 1,800 MHz, resulting in lesser number of BTS.

The reduction in the number of BTS, in turn, results in a reduction in capex. Ambani also alleged that this would affect the new entrants, as they would be disadvantaged on the "false pretext that there is no adequate spectrum".

In his letter on November 19 to the prime minister, Ambani said that existing GSM operators were not entitled to more than 6.2 MHz spectrum.

He also urged the prime minister to ask GSM operators to surrender the extra spectrum, or make them pay for the additional spectrum they used.