New players may have to cough up more

The revamped 2G spectrum allocation policy will put more pressure on new operators who were given cellular licences in 2008. While they are facing a potential cancellation of their licences, now they will have to think about paying more for spectrum if they manage to wriggle out of the allegations of impropriety while obtaining the licence.

Operators such as Reliance Communications, Uninor, Videocon, STel, Tata Teleservices and Etisalat DB were given 4.4 Mhz and are eligible for another 1.8 Mhz under the existing rules. But the new policy will force them to pay for the additional 1.8 Mhz.

While the Telecom Regulatory Authority of India is yet to give its recommendations on pricing spectrum, analysts estimate that the new players may have to cough up an additional Rs 2,000-3,000 crore for taking their total quantum of air waves to 6.2 Mhz pan-India.

While new players have to pay for anything over 4.4 Mhz, the incumbent players need to pay only if they hold more than 6.2 Mhz.

When asked to explain the differential treatment Mr Sibal said that since the incumbent players have already been given spectrum beyond 6.2Mhz, the new policy cannot be implemented with retrospective effect. “New players are yet to get beyond 4.4 Mhz so we can change the policy in that regard,” Mr Sibal said.

While most of the new operators did not comment, Tata Teleservices said that they were promised 6.2 Mhz and that should be given to them. “We would re-emphasise that all operators be given 6.2mhz spectrum in a manner that those waiting for start-up spectrum are first allocated the same,” said Mr Deepak Gulati, Executive President, Mobility Business, Tata Teleservices Ltd.

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