Telecom Lead India: Industry body COAI said Indian mobile operators
will be forced to spend nearly $24 billion more on their telecom networks if
the government goes ahead with a proposal to replace the more-efficient
spectrum bands of older carriers with relatively inferior quality spectrum.
Bharti Airtel, Idea Cellular and Vodafone India have opposed
the TRAI’s proposal for refarming their 900 MHz spectrum band with
relatively-inferior quality spectrum in the 1,800 MHz band before their permits
are renewed starting in 2014.
During the forthcoming spectrum auction, operators will be
forced to buy new radio spectrum, and also have to build more mobile network and
replace some of the existing equipment to continue services.
The spectrum switch will force operators write off a total
250 billion rupees worth of assets, as some of their existing equipment becomes
obsolete, said COAI in a presentation to the telecoms minister Kapil Sibal.
How
spectrum refarming affects telecom operators in India
Refarming will do lasting damage to the mobile service
offered by Vodafone to its urban and rural customers and adversely affect
those that wish to contact our customers.
Vodafone has 10 Circles coming up for licence extension in
2014 and 2015. These Circles represent around 65 percent of Vodafone India’s
total mobile subscriber base of 150 million and contribute 65-70 percent of
Vodafone’s total rural subscriber base of 60 million.
The domestic telecom industry is also opposing the TRAI’s
proposals for an upcoming spectrum auction, including the auction starting
price that is nearly 10 times higher than what carriers had paid in a 2008
state grant process, according to a report in Reuters.
The Supreme Court in February ordered cancellation of all
telecoms licences granted in the scandal-tainted 2008 sale and asked the
government to redistribute airwaves through an open auction by August.
The operators also said the call charges would be double of
what TRAI had calculated. The impact would be 30 paise a minute, about eight
times of the regulator’s calculation of 3.6 paise. Besides, it is expected to
result in a fall in minutes of usage by customers.
Meanwhile, the chiefs of Bharti Airtel, Vodafone India, Idea
Cellular, Uninor and Videocon met Sibal and telecom secretary R Chandrashekhar
to discuss the implications of Trai recommendations.
Top officials of CDMA operators Sistema Shyam Teleservices, Reliance
Communications, Tata Teleservices and CDMA body AUSPI also met the minister on
the same issue.
editor@telecomlead.com
