TRAI rejects plea by Airtel, Idea and Jio to postpone 700 Mhz spectrum sale

traiThe Telecom Regulatory Authority of India has rejected the request by three of India’s biggest 4G operators — Bharti Airtel, Reliance Jio and Idea Cellular — to not sell any more 4G spectrum, especially in the strategic 700 MHz band.

The move is likely to lead to a fast rollout of 4G services in rural areas, where the particular band will play a critical role in ensuring coverage.

The three operators had urged the regulator not to sell more spectrum in the band, giving various reasons such as that they already had enough 4G spectrum with them (and need time to utilize them) and so on.

Bharti Airtel had, for example, said that there are only around 214 models of phones and dongles that work on this band right now, and the buyer of this spectrum will find it difficult to build a business if only a few hundred phone models worked on its network.

The operators had also pointed out that they have just recently bought a large amount of 4G spectrum and they need time to roll-out the network and start services, before buying new spectrum. Idea Cellular had pointed out that it would put pressure on its finances if it acquired more 4G spectrum now, instead of focusing on using the air waves already bought.

The request from the three operators who already have 4G spectrum was opposed by those who haven’t been able to buy such spectrum so far.

Those who rooted for more such airwaves to be put to sale include Vodafone, Telenor and Tata Teleservices.

TRAI said it has decided that the 700 MHz sale should go on.

“12 commercial networks have been launched in this (700 MHz) band and 13 countries have already auctioned 700 MHz band spectrum… (The) device eco-system in the APT700 band plan is developing fast and it has already been adopt ed by 40+ countries across the APAC and Latin America regionsm” it said.

“Once India also auction s spectrum in 700 MHz band , it will act as a catalyst for faster development of eco-system in this band.”

traiIndian telecom operators have always complained that they have only a small fraction of the spectrum that their compatriots in western countries have — a factor that has kept the cost of data very high, in turn affecting the spread of Internet in the India.

TRAI said more 4G spectrum will help resolve operators’ complaints about scarcity.

“This will provide significant amount of additional spectrum to Telecom Service Providers ( TSPs ) who have been demanding more spectrum for better quality of service and to reduce the problem of call drops. Above all , non-auctioning of spectrum in this band will be a wastage of this precious resource,” it pointed out.

“In view of the above, Authority reiterates its earlier recommendation that APT700 band plan should be adopted for the 700 MHz (698 – 806 MHz) spectrum band with FDD based 2×45 MHz frequency arrangement. Further, it recommends that entire available spectrum (2x35MHz) in the 700 MHz band should be put to auction in the upcoming auction.”

700 MHz AUCTION NOT POSITIVE FOR JIO/RCOM

Reliance Jio and Reliance Communications are the only two operators who hold any significant amounts of high-penetration 4G spectrum at present. The two have announced a plan to roll-out a near-pan-India LTE network on the 850 MHz band in the coming days.

If the 700 MHz auction was not to take place, it would have ensured that this was the only sub-GHz 4G network in India. Sub-GHz spectrum (such as 800 MHz and 700 MHz) can penetrate inside concrete jungles and also travel far and wide in the countryside, unlike the 2 GHz spectrum used by Airtel, Idea and Vodafone.

However, with the TRAI strongly recommending the auction of 700 MHz band, these operators will also be able to roll out high-penetration LTE networks by as early as Jan-March of next year.

The 700 MHz auction is particularly good news for Vodafone, Telenor and Tata Teleservices — all of which failed to buy required amounts of LTE airwaves in earlier auctions due to competitive bidding.

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