ADVERTISEMENT

TRAI May Revise Pricing After Bidders Ignored 700 MHz Spectrum In Latest Auction

The debt-ridden telecom sector had ignored premium airwaves in the 700 Mhz band.



Students Look at a Smartphone in Mumbai (Photographer: Dhiraj Singh/Bloomberg)
Students Look at a Smartphone in Mumbai (Photographer: Dhiraj Singh/Bloomberg)

Hinting that the telecom regulator may be open to revising the price of spectrum in the 700 megahertz (MHz) band, chairman of the Telecom Regulatory Authority of India RS Sharma said on Thursday that TRAI will conduct a fresh round of consultation with all concerned parties if needed, before the spectrum comes up for re-auction.

The debt-ridden telecom sector had ignored premium airwaves in the high-cost 700 MHz band. It was put for sale for the first time in the latest round of auction at a reserve or base price of Rs 11,485 crore per Mhz, according to data released by the Department of Telecom at the end of the process.

Bharti Enterprises Chairman Sunil Bharti Mittal last week termed the lack of bids for the 700 MHz band as a “missed opportunity” which he attributed to high cost and said that the government needs to re-look at the pricing for this band. “Three or four solid networks around the 700 MHz would have taken care of a lot of rural broadband networks. I hope the government will look into this and correct that particular part,” Mittal had said at the India Economic Summit organised by the World Economic Forum.

Speaking to BloombergQuint on possible revision of the price of the 700 MHz band, Sharma said, ''Spectrum is available, and as and when the government decides, it can be put up for auction again. There is a set process by which TRAI recommends the reserve price. If the government makes a reference to us, we will go through a process of consultation and recommend the reserve price."

However, he did not specifically say if the price of the 700 MHz band will be reduced.

Disagreeing with the contention that the latest round of auction saw subdued activity, the TRAI chairman said “telecom companies got what they wanted and now the lack of spectrum will not be used as an excuse for poor quality of service”.

Whosoever wanted to buy spectrum bought it...there was no scarcity of spectrum on offer. We did not want the complaint of lack of spectrum to exist. So we decided to put all the spectrum to auction so that this excuse or complaint goes away.
RS Sharma, Chairman, Telecom Regulatory Authority of India

On the issues surrounding the launch of Reliance Jio Infocomm Ltd. Sharma said that the regulator is looking into the issue of call failures at points of interconnection, with the best interest of consumers in mind.

Points of interconnection help consumers across different networks to connect to each other.

Reliance Jio had alleged that its consumers were experiencing massive call failures as the incumbent telecom operators – Bharti Airtel, Idea Cellular and Vodafone – did not provide adequate points of Interconnection. Subsequently, the TRAI had issued showcase notices to incumbents over call failures at PoIs. Separately the TRAI had also asked operators to ensure that the situation improves by October 17, 2016.

On the allegation of “predatory pricing” against Reliance Jio, Sharma said the regulator has asked for a response from the Mukesh Ambani-run company and will hopefully come up with a decision by next week.

The regulator also said that the consultation paper on net neutrality will be released by the end of this month.