Recognising the need for quick infrastructure rollout to service the rapidly growing mobile sector (netting over 6 million subscribers a month), the Telecom Regulatory Authority of India (TRAI) has forwarded its recommendations on infrastructure sharing to the Department of Telecommunications (DoT).

According to TRAI, the country requires approximately 330,000 towers by 2010 against the present 100,000. Aside from financing requirements, the time taken to set up individual networks is enormous and is a major hurdle in reaching the target of 500 million subscribers by 2010.

In light of this, TRAI has recommended infrastructure sharing as a tool to roll out services at a faster pace and at more affordable costs. For this, TRAI has asked for amendments in the licence conditions to allow active infrastructure sharing, limited to the antenna, feeder cable, node B, radio access network and transmission systems.It has also suggested sharing of backhaul infrastructure. The non-availability of backhaul, especially in the rural areas, has been a major concern. As the traffic in such areas is likely to be low in the initial stages, there is an obvious advantage of sharing such backhaul to carry traffic from the base transceiver station (BTS) to the base station controller (BSC).Such backhaul sharing can also help reduce the load of the backhaul antennas on the tower, reducing the cost to set up such towers and increase the possibility of sharing the same tower by more operators.

In order to provide a level playing field and roll out opportunities for all licensees, the regulator has consciously expanded the scope of financial incentives for passive infrastructure sharing in rural and remote areas. The regulator has also recognised the need to encourage the use of non-conventional energy sources and has asked DoT to finalise suitable schemes in consultation with the concerned ministry to resolve the critical power availability issue.

Broadly, TRAI’s recommendations include the following:

Passive infrastructure sharing

Though the government has allowed passive infrastructure sharing (the existing provisions of the BSO, CMSP and UASL licences permit it), TRAI emphasises the urgency in implementing it. However, the regulator is against mandating passive infrastructure sharing at this stage as it does not believe that regulatory intervention is necessary, at least not as a first option, while other modes of policy initiatives, including financial incentives, could produce positive results. Accordingly, TRAI has not recommended any legislation/ amendment in the licence conditions.

However, it states that Standing Advisory Committee for Frequency Allocation (SACFA) clearance needs to be provided in a stipulated time-frame. If no communication is received in the prescribed time-frame, the request may be deemed to be approved. Moreover, Category-I infrastructure providers are also allowed to seek SACFA clearance if they have at least one agreement with existing wireless service providers for leasing infrastructure.

Finally, the process of sharing infrastructure should be transparent and non-discriminatory. All licensees must announce on their website details regarding the existing and future infrastructure installations available for sharing with other service providers. A time limit of 30 days for negotiation between the access seeker and provider should be the normal practice. This criterion should be specifically provided in the licence conditions.At this stage, the mode of commercial agreement is being left to telecom service providers. However, the authority could consider a standard commercial format in the future if the process of infrastructure sharing does not pick up.

Identification of critical sites

TRAI recommends that critical infrastructure sites should be identified and notified to facilitate sharing of passive infrastructure in an expeditious manner. In order to do so, it is recommended that a joint working group (JWG) be constituted with the district magistrate as the chairman and representation from all the mobile service providers present in the service area.Besides, representatives of the municipal corporation and the military and cantonment wing (if the area under consideration includes cantonment areas) should be included. The decisions of the committee should be taken in a time-bound manner, preferably within three months.

All identified sites once approved by the committee must be notified as critical infrastructure sites by the office of the JWG. In the case of any disagreement among the service providers for sharing of critical sites, it should be first referred to the JWG.

The municipal corporations and cantonment authorities can grant permission to any service provider/IP-I to set up a tower on the notified sites only when the service provider gives a commitment that the site will be shared by at least three service providers.

Active infrastructure sharing

In a path-breaking move, TRAI has suggested that the UASL/CMSP licence conditions should be suitably amended to allow active infrastructure sharing, limited to the antenna, feeder cable, Node B, radio access network (RAN) and transmission system only.

According to TRAI, the active infrastructure-sharing arrangements can be left to service providers based on mutual agreements. However, they must indicate the intention of active infrastructure sharing in a transparent and predictable manner.

At this stage, the mode of the commercial agreement has been left to the telecom service providers. However, TRAI may consider a standard commercial format in future if the process of infrastructure sharing does not pick up. Sharing of the allocated spectrum is not permitted.

Backhaul sharing

Considering the importance of backhaul sharing for provision of mobile services in rural and far-flung areas, TRAI reasons that the licensing conditions in the UASL Clause 33 and CMTS Clause 34 should be amended to allow service providers to share their backhaul from BTS to BSC only. Such sharing is permitted on optical fibre as well as radio medium at port size E1 and multiples thereof (nxE1). Again, no sharing of spectrum at the access network site is permitted.

Financial and economic measures for infrastructure sharing

As incentives for infrastructure sharing in the urban areas, TRAI recommends that the civic bodies may be requested through DoT to charge such amounts from all service providers sharing infrastructure so that the total amount charged per tower should not be more than 1.2 times the amount being charged from individual service providers when the tower is not shared, instead of charging the same amount of processing fee and other charges from all the operators sharing a site. Also, incentives in the form of processing fee and other charges, TRAI feels, would encourage passive infrastructure sharing.

Incentives for infrastructure sharing in rural areas

TRAI recommends that a subsidy for erecting towers should be made available to service providers not benefiting under the USO Fund scheme in order to maintain a level playing field. The subsidy should be provided from the Fund to service providers/IP-I players to erect towers and share them with service providers, as per the following scheme:

  • Subsidy to be provided to only those service providers/Category I infrastructure providers who are not beneficiaries under the USO Fund scheme within that particular short distance coverage area (SDCA).
  • The mobile tower design should have capacity to accommodate at least three service providers to be eligible for availing of subsidy under the proposed licence. The passive infrastructure has to be created within one year from the date of registration with the USO Fund administrator to be eligible for subsidy.No subsidy should be paid if such infrastructure is not set up to roll out mobile services within one year.
  • The service provider/Category I infrastructure provider who is not a beneficiary under the USO Fund scheme should erect the tower and share it with three service providers (not beneficiaries under the USO Fund in that SDCA) to roll out mobile services.They shall also be entitled to subsidy from the USO Fund equal to 80 per cent of the amount decided under the USO Fund scheme based on the bidding process, from the date of rollout of mobile service using this tower.
  • If only two service providers not beneficiaries under the USO Fund scheme share a newly erected tower and roll out mobile services, the amount of subsidy payable from the USO Fund to the service provider/Category I infrastructure provider who erects the tower shall be proportionally reduced, compared with the amount when the tower would be shared between three service providers.
  • No subsidy should be paid if the newly erected tower is not shared. This is to encourage the concept of infrastructure sharing in rural and remote areas.

    According to TRAI, the burden of having a mutual agreement for sharing passive infrastructure should be left to the service provider/Category I infrastructure provider who is setting up the passive infrastructure.

    The need is not only to encourage setting up of such towers but to achieve this within a specified time-frame. To ensure this, a Category I infrastructure provider or service provider who is not a beneficiary of the USO Fund scheme has to register with the USO Fund administrator along with commitment letters from other service providers (not beneficiaries under the USO Fund in that SDCA) who wish to share the tower. The passive infrastructure has to be created within one year from the date of such registration to be eligible for subsidy.

    Incentives for using non-conventional sources of energy

    TRAI recommends that the Ministry of New and Renewable Energy may be approached by DoT to evolve a proactive policy framework to encourage the use of environment-friendly non-conventional energy sources. Some of the specific measures in this regard are given below:

  • To devise a policy to promote the use of solar power and alternative fuel specifically for the telecom sector.
  • To provide telecom-specific advisories on equipment availability, costs, sources for procurement, etc. to service providers.
  • To maximise the subsidies for telecom operators considering the potential of high use of such devices in the telecom sector.
  • To examine possibilities for the use of other non-conventional environmentfriendly energy sources.

    TRAI also suggests that DoT may evolve a scheme of subsidy per site to service providers using non-conventional energy sources.

    Given that operators are looking to roll out extensive networks, which require massive investments in passive, active and backhaul infrastructure, TRAI’s recommendations are indeed timely. They will, moreover, be crucial in driving growth in the mobile segment and in spreading rural telephony.