5G auction: DoT allows reduction in spectrum usage charges
New Delhi, Jun 23: The Department of Telecom (DoT) has issued a new order that will enable telecom operators to reduce spectrum usage charges proportionately on buying fresh radiowaves in the upcoming 5G auction.
The DoT, in the order dated June 21, has removed spectrum usage charge (SUC) from the radiowaves that will be bought in the auction scheduled to start from July 26.
The government will, next month, auction about Rs. 4.3 lakh crore worth of airwaves capable of offering fifth-generation or 5G telecom services including ultra-high-speed internet.
The DoT collects SUC from a company based on a weighted average method, where charges applicable for each auction and spectrum acquired is taken into account and the sum is divided by the total spectrum acquired by it in various auctions.
The
order
notifies
a
new
formula
which
makes
the
SUC
rate
nil
for
the
upcoming
auction.
Till
the
previous
auction,
telecom
operators
were
required
to
pay
SUC
based
on
3
percent
of
the
amount
at
which
they
purchased
the
spectrum.
The
Cabinet
in
September
2021
had
approved
removal
of
SUC
from
future
auctions.
"The SUC order by DoT is a positive move with 3 percent interpretatively going off. Industry could see the real benefit of nil SUC charges proposed in the 5G auction being available to the participating players," EY Global TMT Emerging Markets leader Prashant Singhal said.
"We welcome and thank the government and Minister of Communications for the much-awaited DoT order regarding the levy of SUC charges for spectrum... The order will provide clarity to telecom service providers for the upcoming auctions," industry body COAI Director General S P Kochhar said.
(PTI)