Dr J.S. Sarma, chairman, Telecom Regulatory Authority of India (TRAI) has dismissed GSM operators’ charges that its recommendation to revise 2G spectrum prices will heavily impact them and said the companies were looking at the issue from a narrow perspective, according to news reports.
TRAI has recommended fixing uniform licence fees at 6 per cent of adjusted gross revenue (AGR) over a period of time, compared to 6-10 per cent now, depending upon the circles, along with rationalisation of annual spectrum charges.
Sarma’s comments follow Bharti airtel, Vodafone Essar, Idea Cellular, TATA DOCOMO and Reliance Communications criticising TRAI for framing ?irrational and discriminatory” recommendations on spectrum prices.
In fact, both factions, new and old GSM service providers opined that TRAI?s recommendations benefited the other. The new operators termed TRAI’s recommendation as benefiting old GSM players, saying the extra spectrum hoarded by old operators would be legalised at a fraction of the actual cost.
They said that the operators should be asked to return the extra airwaves or else there should be a recurring cost and not a one-time entry fee, as proposed by TRAI.
In contrast, Vodafone Essar said TRAI’s new set of recommendations are flawed, illogical and discriminatory against the operators that were the first to invest deeply to build the sector. Similarly, Bharti also said that the recommendations go against the stated principle of the government to offer affordability, fairness and a level playing field. It added that there seemed to be huge inconsistency in terms of the differences of prices in various circles, which defies logic.
TRAI said that taking all elements of its recommendations in totality, the operators would actually save money over the licence period.
Besides lowering licence fees and rationalisation of spectrum charges, TRAI is also in favour of lowering operators’ contribution to the Universal Service Obligation (USO) fund, a levy which is used to subsidise operators to offer services in rural areas and villages.
Sarma urged the operators to look at all elements of its recommendations collectively and not selectively, on the basis of spectrum prices alone.
