Spectrum wars force: Govt to set up panel

New Delhi, Dec 21: In the wake of fierce battle between the mobile players GSM and CDMA, the government has set up a fresh panel to review spectrum allocation for telecom companies.

The government has suggested a two-stage formula in which auctions would determine allocation of spectrum to mobile players, industry sources said. This panel has been formed on incremental allocation of spectrum. The panel will be headed by K Sridhar, Department of Telecommunications (DoT) Member (Technology) The panel has suggested allocating incremental quantities of spectrum which includes granting a minimum allotment to an operator along with the licence, and then auction the remaining spectrum.

There will be a cap on total spectrum an operator can have. This will help both incumbents looking for expansion of scale or area and new applicants.
This new twist comes in the wake of reports stating the Telecom Ministry has initiated tariff reviews that could translate into further fall in call and roaming charge.

The government is understood to going for a cost-based pricing formula along the lines of what is being adopted in sectors like power. Mr Raja envisages further cut in tariffs which is already amongst the lowest in the world as of today.

But pulling tariff down may not be easy because of a mix of factors like resistance from companies and an aversion to state intervention in matters like tariff determination. Meanwhile, the committee set up by the Department of Telecommunications (DoT) to look into changes in the subscriber criterion has argued that there is a definite scope to enhance the existing criterion considerably.

The committee is of the opinion that the Telecommunication Engineering Centre' s (TEC's) calculation was based on scientific methods and so was that of the regulator, but with certain practical considerations.

While the Telecom Regulatory Authority of India (Trai) had suggested doubling to a four-fold increase in the subscriber criterion, the TEC had suggested doubling of the regulator's recommendation.

With GSM operators opposing the move, a committee having members from the Government and the operators was set up.

However, COAI, representing the GSM lobby, walked out of the committee saying it was hurrying through the discussions and it was not based on scientific methods.

In their observations the committee has opined that science taken with innovative efficiency improvement methods, which operators should employ, could lead to even greater numbers than Trai and TEC.

UNI