Reliance, Tatas to get extra spectrum

Bharti, Hutch will have to wait for defence frequencies: Trai.

The Telecom Regulatory Authority of India (Trai) today recommended that CDMA operators like Reliance Infocomm and Tata Teleservics be provided additional spectrum in the 800 MHz band and GSM players such as Bharti, Hutch and Idea be allocated the 1800 MHz frequency, which is currently occupied by the defence services.

If the recommendations are accepted by the government, Reliance Infocomm and Tata Teleservics and will be able to offer third-generation (3G) equivalent mobile services such as video streaming, mobile TV and high-speed internet within a month of the government notifying the Spectrum Policy.

On the other hand, GSM players will have to wait till the 1800 MHz spectrum is vacated by the defence services. Even then, the GSM operators cannot offer 3G services as this spectrum is configured for normal cellular services.

Trai has said the defence services be given up to December 2006 to vacate the frequency.

To let the operators offer 3G services, Trai has recommended that the IMT-2000 2 GHz band, which is also currently occupied by the defence services, be allocated to GSM operators as well as CDMA players.

However, the operators will have to pay an additional annual charge for using this frequency till they roll out their services.

On his part, Trai Chairman Pradip Baijal said the recommendations were a "loud and clear statement that the authority was technologically neutral".

"The same amount of spectrum should be available to players on both the technological platforms. If CDMA is more spectrum efficient and can offer additional services within the allocated band, it is a technological challenge and not a regulatory issue," he said.

The final Trai recommendations are different from an earlier draft that had said only the largest CDMA operator would be eligible for the additional spectrum.

In addition, Trai has paved the way for further lowering of mobile tariffs by recommending that the ceiling on annual spectrum charges be reduced to 4 per cent of the adjusted gross revenue (AGR) from the existing 6 per cent.

Operators said the move would lead to a small reduction in cellular tariffs.

GSM-based cellular operators said the recommendation to give additional spectrum to CDMA without ensuring optimal use of existing assignments would facilitate immediate backdoor entry for 3G services for the latter.

"The provision for additional carriers for CDMA is grossly anti-competitive and will enable them to offer 3G services through the backdoor. This is an exact replay of the WLL recommendations where CDMA got a backdoor entry into mobile services," said TV Ramachandran, director-general, Cellular Operators Association of India, the body representing GSM players.

The Association of Unified Service Providers of India (AUSPI), the CDMA lobby, while refusing to comment on the allegations put forward by the COAI, said the proposals "favored both platforms equally".

"While both of us will get the IMT-2000 band, CDMA players are at a disadvantage here as we do not have compatible equipment," the AUSPI said.

The regulator also declined to offer the 1900 MHz frequency, which was demanded by both GSM and CDMA players on the grounds that this band could not be vacated by the defence sector.

Trai has also said spectrum be cancelled if the 3G services are not rolled out within two years from the date of allocation of IMT-2000, and has proposed an additional annual spectrum charge on per MHz basis to avoid hoarding of spectrum.

The recommendations added that new operators should be allowed only in areas where spectrum requirements had been met and additional spectrum was available.