DoT rejects Trai proposal on spectrum base price

A panel constituted by the Department of Telecommunications (DoT) has rejected recommendations of Telecom Regulatory Authority of India (Trai) regarding spectrum base price and availability of airwaves the February 201auctions.

The panel, formed to study the recommendations, has suggested applying the same method used in the February 2014 auctions for determining valuation and reserve price of 1,800 MHz-widely known as 2G-and 900 MHz spectrum band for the next auctions, according to news agency PTI.

The committee is of the view that the same approach for arriving at reserve price for auction of spectrum during February 2014 may be incorporated in the methodology for arriving at reserve price of 1,800 MHz, a source said.

Trai had suggested about 10-per cent higher base price than what was received in the February auctions. However, the committee found that using Trai method will lead to about 3-20-per cent higher base price across some circles compared to the rates suggested by the regulator.

The government is estimated to garner, at least, Rs 9,355 crore from the next auctions.

Most of the spectrum proposed to be put up for sale are being used by Bharti Airtel, Vodafone India, Idea Cellular and Reliance Communications. These companies will need to buy back airwaves to continue their operations in areas where their licences will expire in 2015-16.

The committee has also turned down Trai's recommendation to take back 900 MHz from state-run BSNL saying that DoT has no jurisdiction to take back spectrum from the public sector firm under licence condition and suggested the regulator should review its suggestion. The DoT committee has also suggested CDMA spectrum cannot be taken back from MTNL and BSNL.

The regulator had suggested that 60 MHz of paired spectrum in 2,100 MHz band should be put up for sale in proposed auction. A part of this band is held by defence forces.