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Thomas K Thomas

New Delhi, Nov. 6 In a blow to existing GSM mobile companies, the committee set up by the Department of Telecom to look at the issue of revenue separation between 2G and 3G services has taken a view that this was not a practical solution.

The committee has taken the view that it will be difficult to verify and audit the operator’s network and, therefore, bifurcating revenue is not practical.

“Though it is technically possible to employ complex software tools and the call data record to distinguish traffic carried on spectrum meant for 3G services from traffic carried on spectrum meant for 2G services, this computation will be exponentially complex to verify and audit. Segregation of 2G and 3G revenues is thus ruled out on practical grounds,” said a DoT internal note.

The views are in line with the stance taken by the Ministry of Communication. Mr A Raja, Minister for Communications and IT, had earlier told Business Line that bifurcation of revenues was technically not possible.

To address issues related to level playing field, the panel has suggested that stand alone 3G operators could be asked to pay 3 per cent of their annual revenues as spectrum charge. Those who have less than 6.2 Mhz of 2G spectrum combined with 3G spectrum may be asked to pay 4 per cent of the revenues and those with more than 6.2Mhz could be asked to pay a total of 5 per cent of their annual revenues.

If this proposal is accepted by the Telecom Commission then it will hit the GSM player’s revenues. Instead of paying just one per cent of the revenues from 3G services, they will have to pay between 4 per cent and 5 per cent.

CDMA operators, on the other hand, are in favour of this move as they will have to pay a maximum of 4 per cent revenue share since none of them have more than 5 Mhz of 2G spectrum.

The panel has also suggested that operators with dual technology should declare whether the 3G spectrum is going to be employed in combination with CDMA spectrum or the GSM or both. “Since the 2G revenues from GSM and CDMA are treated separately, this declaration will determine which steam will have combined 2G and 3G revenues for determining the spectrum charge,” the note said.

More Stories on : Regulatory Bodies & Rulings | Telecommunications

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