COAI sues DoT over dual spectrum norms

The Cellular Operators Association of India (COAI) "" the lobby for GSM-technology mobile service operators "" has filed a suit against the Department of Telecommunications (DoT) alleging that its decision to allow "crossover" allotment of spectrum for both GSM and CDMA players smacks of "legal malafide".

The suit asking for a stay against the Government order permitting crossover allotment was filed today at the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), which will hear the petition tomorrow (Wednesday).

In its petition, the COAI has said the DoT's decision has been taken with "unseemly" haste to benefit a few operators that have made a "backdoor entry" on the basis of "invalid applications" given in February 2006.

The operators in question are CDMA-technology service providers Reliance Communications (RCom), Himachal Futuristic Communication Ltd (HFCL) and Shyam Telelink.

Last week, the government had permitted crossover or dual spectrum usage to existing licensees. This means that companies operating CDMA services would be eligible for GSM spectrum on the same licence at Rs 1,680 crore for pan-Indian operations.

The COAI's petition alleges the DoT had "bypassed due process" in allowing dual usage. It said the telecom ministry first took a decision on or before October 18 to permit the allotment of GSM and CDMA spectrum on the same licence, allowing CDMA operators to make necessary payments (on October 18) before announcing its decision on allowing dual spectrum on October 19 to the public and GSM operators through a press release.

"...In-principle approval has been issued to the CDMA operators even before the licences were amended in order to make the decision a fait accompli," the petition says.

DoT's decision principally impacts GSM operators like Bharti, Vodafone-Essar, Idea, and Aircel which have been waiting for spectrum since December 2006 or have asked for additional spectrum. RCom had applied for spectrum in February 2006 in 15 circles.

On the basis of the DoT's first-come, first-served policy, the decision puts Anil Dhirubhai Ambani Group-controlled RCom ahead of the 40-odd players who have applied for new licences and existing operators with licence applications for expansion ahead of the queue for the allocation fo spectrum.

GSM and CDMA services cannot share the same spectrum since they operate on different frequencies which is why CDMA operators need to apply separately for spectrum for GSM services.

The issue of allocating spectrum "" radio frequencies that enable mobile communications "" has become controversial owing to a shortage following delays by the defence ministry to release spectrum for civilian use.

The petition says RCom's application is invalid as no policy existed at that time on dual spectrum allocation. The COAI has also criticised the DoT's decision to increase the subscriber base criterion by over 700 per cent for allocation of additional spectrum to existing players.

Most existing operators from Bharti (except in one cirlce), Vodafone-Essar and Idea will not get any additional spectrum under the new norms as they have not reached these new subscriber numbers.

The petition points out that the department's decision would encourage spectrum to be hoarded by one set of operators which will compromise competition.

It also notes that as a result of DoT's decision, one large CDMA operator (R-Com) will now be entitled to hold four times the quantum of spectrum than other operators in some service areas (as it will get 4.4 MHz of GSM apart from what it is entitled in CDMA).

The petition reiterates that dual spectrum is not allowed within the existing licensing policy, and while the telecom regulator had recommended its consideration, its acceptance by DoT should have been followed by Cabinet approval (since it impacts the entire sector).

After this, the guidelines should have been shared by the public at large. COAI also contends that DoT's decision that spectrum charges should be paid separately for the two technology streams was clearly aimed at benefitting CDMA operators who would pay a lower rate of spectrum charges even though they have double the spectrum of a GSM operator.