Date:04/11/2007 URL: http://www.thehindubusinessline.com/2007/11/04/stories/2007110451370100.htm

Back RCom, Aircel, Vodafone, Idea may get more spectrum

Ministry’s move nixes DoT’s auction proposal

More in the air
COAI had filed a case against RCom’s GSM entry
Ministry is in favour of cos which have paid the fee
Defence’s 20Mhz can hold five operators

Thomas K Thomas

New Delhi, Nov 3 Reliance Communication (RCom), Aircel, Idea Cellular and Vodafone Essar could get more spectrum for expansion. The Ministry of Communications is set to approve allocation of spectrum to these operators ahead of the other 46 applicants as these four companies have already paid the required licence fees.

Spectrum circles

While Aircel is likely to get spectrum for 14 circles, Idea Cellular is expected to win spectrum for Mumbai and Bihar. Vodafone Essar is likely to be allotted six new circles in Tamil Nadu, West Bengal, Orissa, Assam, North East and Jammu and Kashmir. RCom, despite objections from the Cellular Operators Association of India, could also be given the go-ahead for a pan-Indian GSM rollout. The Ministry is also set to direct the Department of Telecom to issue letter of intent to other new applicants who fulfil the eligibility criteria.

First in line

The Ministry’s proposal, however, means that once the Defence releases spectrum, these four companies would be the first to get it. This also means that the Government is in favour of continuing to award spectrum on a first-come first-serve basis despite DoT’s suggestion to conduct an auction.

The Defence is likely to release 20 Mhz spectrum in which one more operator can be accommodated other than the four.

Pan-Indian operators

The four companies will now be all set to become pan-Indian GSM mobile operators and join the league of Bharti Airtel, which is the only operator with a national footprint. The spectrum allocation proposal, would, however be bad news for Bharti Airtel, which is the only major telecom company not to get spectrum this time around. Even State owned BSNL and MTNL have been given up to 10 Mhz. This could also divide the GSM industry, which has filed a legal petition against the decision to give permission to RCom to offer GSM services in addition to its existing pan Indian CDMA mobile services.

While Aircel has already withdrawn from the legal proceedings, it could now be difficult for Idea Cellular and Vodafone to support COAI’s petition as they are also now benefiting from the Government’s decision.

However GSM industry sources said that the operators would remain united as the opposition was to allowing RCom’s entry into GSM services ahead of the other 46 applicants and larger issues related to increasing the subscriber base criteria for additional spectrum were yet to be resolved. They pointed out that RCom had applied for GSM spectrum citing shortage in CDMA radio waves, which is contrary to the Government’s new policy asking operators to pack in more subscribers within the given frequencies.

Related Stories:
RCom pays entry fee for foray into GSM segment
DoT pushes for auction of GSM spectrum
No spectrum allocation till Nov 12, says Centre