The Department of Telecommunications (DoT) may permit sharing of spectrum by two or more operators under the New Telecom Policy 2011. However, trading 2G spectrum will not be permitted.
An internal DoT communication stated that while the Telecom Regulatory Authority of India (TRAI) had recommended spectrum sharing, spectrum trading was not recommended. This was because the price of 2G spectrum was not determined by the market, as it was bundled with the licence and further allocation was made based on the operator?s subscriber base.
DoT hopes that spectrum sharing will help make up for its shortage in the sector, as it will enable operators to lease surplus spectrum to other operators on commercial terms.
There are several operators who have not been able to corner an adequate number of subscribers, so as to fully utilise spectrum allotted to them, especially the new operators.
DoT?s note added that stakeholders have suggested an adequate funding mechanism for operators, sharing active infrastructure for better operational efficiency and easier merger and acquisition (M&A) norms.
With regard to spectrum, stakeholders feel that it should be allotted, based on technology neutrality, service flexibility, timely allocation and reconciliation and enhanced transparency.
Prior to this, in May 2010, to assess operators? spectrum requirement per circle and to decide the pricing and allocation of 2G spectrum, TRAI had released recommendations under the Spectrum Management and Licensing Framework.
Keeping in mind that multiple operators function in each service area, the regulator had given recommendations pertaining to M&As and spectrum sharing and trading.
TRAI had recommended that spectrum sharing be allowed between operators, provided each of them does not hold more than 4.4 MHz/2.5 MHz of spectrum. Leasing of spectrum, however, should not be permitted, it had added.
Further, TRAI was not in favour of spectrum trading, as 2G spectrum has either been given with the licence or given based on subscriber linked criteria, without any additional charges for the spectrum.
