‘Operators must be told to surrender excess spectrum'.

Our Bureau

New Delhi, Jan. 28

Reliance Communications has written to the Department of Telecom stating that the Government should ask incumbent mobile operators with more than 6.2 Mhz spectrum to surrender the excess radio waves.

RCom's letter follows a communication from Vodafone to the DoT, which said that incumbent players pay a higher fee to the Government on a per-Mhz basis and therefore the Government should make the levies the same for all players.

Vodafone had said that by levying the same fee on all service providers, the Government would ensure efficient utilisation of spectrum and adequate revenues. Vodafone said that incumbent players, including Bharti, were paying up to 800 per cent more than what RCoM and Tata Teleservices are paying per Mhz of spectrum.

In response, RCom has shot off a letter to the DoT contesting the stand taken by Vodafone. “The misrepresentation by Vodafone regarding the use of spectrum held by dual technology operators is an attempt to move attention away from the anomaly of allocation of spectrum beyond the contractual threshold without payment of any entry fee. The incumbent operators have been in operations for up to 15 years and thus have higher revenues on their GSM network. Obviously, the new operators will have lesser revenues and thus pay lesser spectrum charges,” RCom said in the letter to the DoT.

When contacted, a Tata Teleservices spokesperson said “It is to be noted that some of the dominant operators are holding in excess of over 10 MHz of spectrum across circles, beyond the contracted spectrum of 6.2 MHz which has not been paid for. This itself should fetch the Government over Rs 20,000 crore on being charged at market prices. The Government should charge these operators immediately at market prices, failing which these operators must be asked to surrender the excess spectrum,”

Existing GSM players and new operators have been at loggerheads over spectrum issues for the past few years. This feud is expected to hit a new crescendo with the telecom regulator set to announce its recommendations on future allocation of spectrum. TRAI's suggestions will have major ramifications on the operator's finances.

(This article was published in the Business Line print edition dated January 29, 2010)
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