The Hindu Business Line : TRAI for limiting no. of 3G operators; COAI moots `beauty contest'

Band master
TRAI has indicated that the demand of 3G spectrum was more than the supply.
It said that there will be an entry fee for 3G services

New Delhi , Aug. 23

Only some of the existing mobile operators may be allowed to offer 3G services. The Telecom Regulatory Authority of India (TRAI) has hinted at undertaking a selection process to determine the operators who would be allowed to offer the services. In a meeting with the telecom industry held on August 18, the TRAI has indicated to the operators that the demand of 3G spectrum was more than the supply, therefore every operator may not be accommodated. TRAI has also said that there will be an entry fee for 3G services.

While there are seven operators who may be interested to offer 3G services, there is only 25 MHz radio frequency available in the 2.1-Ghz band. As per international norms, each operator should get at least 5 MHz of spectrum for 3G services, which means that to accommodate everyone the Government will have to find 35 MHz.

In response to the TRAI suggestion, the Cellular Operator's Association of India (COAI) has told the telecom regulator that if necessary, TRAI should wait till adequate spectrum is vacated by Defence to accommodate all the existing players. The COAI has also said that in case a selection process has to be adopted, the price of spectrum should be such as to defray the total cost of refarming divided by the number of players. This would work out to about Rs 200 crore for 5 MHz of the all-India spectrum per operator.

"It is further submitted that, if, at that price too, the demand is still more than the supply, then a beauty-contest approach may be adopted, with pre-determined weightages being transparently applied to parameters such as tariff for service, investments to be made and infrastructure sharing," the COAI said in a letter to TRAI. Earlier, Tata Teleservices had said that it was in favour of competitive bidding in case the spectrum was not adequate.

The COAI, which represents the GSM-based cellular operators, has also said that if only limited operators are awarded the 3G spectrum, the remaining operators should also have the opportunity to contribute to the growth and development of 3G, which could be in the form of infrastructure sharing.

The COAI has raised objections to TRAI's proposal to conduct pilot test on 1,900 MHz for CDMA operators to check if it caused interference with GSM services.

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