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COAI ‘disappointed’ with TRAI recommendations, calls for a relook

Telecom titan Sunil Bharti Mittal on Tuesday said he would agree with what the Cellular Operators’ Association of India (COAI), in its response to the latest Telecom Regulatory Authority of India (TRAI) recommendations on telecom spectrum auction, said, as it holds the voice of the industry. COAI, on its part, has said that it is “disappointed” with the recommendations.

“Given the recent seminal reforms for the telecom sector announced by the government, these recommendations are one step backward than forward towards building a digitally connected India. The spectrum pricing recommended by TRAI is too high,” COAI said.

Throughout the consultation process, industry had presented extensive arguments based on global research and benchmarks, for significant reduction in spectrum prices, it said. “Industry recommended 90 per cent lower price, and to see only about 35-40 per cent reduction recommended in prices therefore, is deeply disappointing,” the telecom industry body said.

In response to a question by BusinessLine, Sunil Mittal said, “They (COAI) are honestly holding the voice of the industry … I assume it is a unanimous statement by the COAI … I haven’t seen the statement, but what I am saying is that they represent the industry.”

Allocation period

TRAI on Monday had recommended a mega auction plan valued at over ₹7.5-lakh crore at the base price across multiple bands for radiowaves allocated over 20 years.

COAI statement added that despite the government’s decision to allocate 5G spectrum for a period of 30 years, the TRAI has decided to recommend reserve prices for 20 years and applied 1.5 times multiple to the price if spectrum is to be taken for 30 years.

“If one were to look at the pan-India price of 3.5 GHz spectrum, then we are back to square one with effectively no change and will nullify the relief provided by the Union Cabinet in 2021. This defies logic and calls for lower spectrum prices by the industry and intelligentsia to keep spectrum prices lower to enable the industry in aggressive network rollouts that will require massive investments,” it said.

Delinked from reality

It also alleged that by introducing mandatory rollout obligations for 5G networks without even factoring the huge cost of such rollout, TRAI has delinked itself from reality and is running counter to the government’s efforts of enhancing ease of doing business.

Therefore, it asked TRAI to ‘revisit its spectrum pricing recommendations’. “The industry strongly believes there is enough and more headroom available to reduce spectrum prices by 90 per cent, in line with global norms. TRAI must do away with the 1.5 times price multiple for 30 years spectrum allocation,” it added.

Scientific calculations

Meanwhile, PD Vaghela, Chairman, TRAI, said the regulator’s recommendations of a 39 per cent drop in spectrum prices are rational, attractive and backed by “scientific calculations”.

Speaking to PTI, he expressed hope that the recommended reserve prices will attract bidders in the forthcoming auction. He also said that the ease of doing business, extensive stakeholder inputs, and facilitating the proliferation of 5G in the country have been the most important drivers for TRAI’s latest stance.

Published on

April 12, 2022

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