Here's why mobile call rates may fall soon
rai gave its recommendations to the telecom ministry, which will now work on final recommendations related to spectrum sharing as well as trading
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NEW DELHI: The Telecom Regulatory Authority of India (Trai) gave a go-ahead to sharing of spectrum between operators, a move that is expected to enhance the efficiency of the coveted airwaves and boost the quality of service offered to customers. The decision has the potential to lower customer tariffs, though not immediately.
Trai gave its recommendations to the telecom ministry, which will now work on final recommendations related to spectrum sharing as well as trading (where recommendations have already been submitted). Trai said sharing of spectrum has to be within the same band, and recommended a minor 0.5% increase in the spectrum usage charge (SUC) fee due to the enhanced airwave holdings. The stipulation on the same band means that both the operators should have individual spectrum in the band, say 800/900/1800 MHz, where they wish to share the airwaves. Trai has also allowed sharing of spectrum in the 3G band, something that was not being considered earlier.
In a major relief to the debt-laden industry, the regulator did not bar — or put additional charges — in case of sharing of spectrum that was not bagged through auction but came through the administered price mechanism.
"The basic objective of spectrum sharing is to enhance spectral efficiency by combining/pooling the spectrum holding of two licensees... Spectrum sharing would involve both the telecom service providers (TSPs) utilizing the spectrum. Leasing of spectrum is not permitted," Trai said.
Trai did not recommend any major charges for spectrum sharing, stipulating a fee of Rs 50,000 for each circle. Also, it sought to have least bureaucratic controls, saying that operators will not need permission from the government for spectrum sharing but will only have to inform.
The sharing of airwaves will help operators pool in resources in areas where there is too much of congestion and spectrum is scarce. Higher spectrum availability through sharing has the effect of boosting the efficiency of the airwaves manifold, which is likely to lower cases of call drops and boost internet speed.
The beleaguered telecom operators are now keenly awaiting the final recommendations from the government on sharing and trading of spectrum. Trai's decision may, however, dampen future spectrum auctions as operators may not go very aggressive in their bids knowing that they can share or trade the airwaves. This may impact the collections that the government hopes to get through sale of mobile airwaves.
Rajan Mathews, director-general of GSM lobby group COAI, said the recommendations will have a positive impact on the quality of mobile services. However, he said the spectrum holding caps that have been retained by Trai — 25% of total spectrum assigned and 50% in a band - may come in the way of sharing between big operators like Airtel or Vodafone.
CDMA lobby group AUSPI said the recommendations do not provide clarity on sharing of spectrum in those districts where operators have not been allocated spectrum although they were entitled to do it under their licences
Trai gave its recommendations to the telecom ministry, which will now work on final recommendations related to spectrum sharing as well as trading (where recommendations have already been submitted). Trai said sharing of spectrum has to be within the same band, and recommended a minor 0.5% increase in the spectrum usage charge (SUC) fee due to the enhanced airwave holdings. The stipulation on the same band means that both the operators should have individual spectrum in the band, say 800/900/1800 MHz, where they wish to share the airwaves. Trai has also allowed sharing of spectrum in the 3G band, something that was not being considered earlier.
In a major relief to the debt-laden industry, the regulator did not bar — or put additional charges — in case of sharing of spectrum that was not bagged through auction but came through the administered price mechanism.
"The basic objective of spectrum sharing is to enhance spectral efficiency by combining/pooling the spectrum holding of two licensees... Spectrum sharing would involve both the telecom service providers (TSPs) utilizing the spectrum. Leasing of spectrum is not permitted," Trai said.
Trai did not recommend any major charges for spectrum sharing, stipulating a fee of Rs 50,000 for each circle. Also, it sought to have least bureaucratic controls, saying that operators will not need permission from the government for spectrum sharing but will only have to inform.
The sharing of airwaves will help operators pool in resources in areas where there is too much of congestion and spectrum is scarce. Higher spectrum availability through sharing has the effect of boosting the efficiency of the airwaves manifold, which is likely to lower cases of call drops and boost internet speed.
The beleaguered telecom operators are now keenly awaiting the final recommendations from the government on sharing and trading of spectrum. Trai's decision may, however, dampen future spectrum auctions as operators may not go very aggressive in their bids knowing that they can share or trade the airwaves. This may impact the collections that the government hopes to get through sale of mobile airwaves.
Rajan Mathews, director-general of GSM lobby group COAI, said the recommendations will have a positive impact on the quality of mobile services. However, he said the spectrum holding caps that have been retained by Trai — 25% of total spectrum assigned and 50% in a band - may come in the way of sharing between big operators like Airtel or Vodafone.
CDMA lobby group AUSPI said the recommendations do not provide clarity on sharing of spectrum in those districts where operators have not been allocated spectrum although they were entitled to do it under their licences
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