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In a move that will put additional cost on mobile companies, the Telecom Regulatory Authority of India (TRAI) on Wednesday suggested that the Government should collect a one-time fee from operators with 2G spectrum.
The telecom regulator has suggested an additional fee of Rs 1,769 crore per Mhz of spectrum on operators with less than 6.2 Mhz and Rs 4,571 crore per Mhz from companies with more than 6.2 Mhz.
The near term financial impact of this proposal on seven incumbent operators will be about Rs 16,000 crore, according to Government estimates. Bharat Sanchar Nigam Ltd will have to pay the most at Rs 7,000 crore since they have 10 Mhz of spectrum. Bharti Airtel will have to pay about Rs 1,740 crore for excess spectrum beyond 6.2 Mhz and Vodafone Essar's pay out will be close to Rs 2,500 crore.
The burden on Tata Teleservices and Reliance Communications will be less than Rs 70 crore.
Financial impact
The long-term financial impact will be even bigger because TRAI has said that the operators will have to pay for the entire spectrum they hold when they go for renewing their licences. The Government had started giving mobile licences since 1994 for 20 years and so some of the old operators such as Bharti Airtel and Vodafone Essar will have to cough up Rs 4,571 crore for every Mhz they hold.
That could put a burden of nearly Rs 40,000 crore over the next 3-4 years. This is worrying the old GSM operators.
Proposals ‘flawed'
Vodafone Essar's CEO, Mr Martin Pieters, termed the proposals as flawed, illogical and discriminatory against the operators that were the first to invest deeply to build the sector and are aggressively pushing a rural roll-out programme.
“Based on a completely arbitrary way of calculating the value of spectrum, the TRAI's outcome is that 2G spectrum above 6.2 MHz will be priced nearly 40 per cent more than the already overpriced 3G spectrum, despite 3G spectrum being far more efficient,” Mr Pieters said.
The TRAI proposal is based on a report by a four-member expert panel.
The regulator said that the proposal to cancel some of the new operator's licences for failure to meet roll-out obligations will release additional spectrum. This spectrum should be auctioned, the TRAI stated.
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