New twist to spectrum war

GSM operators believe that CDMA players are getting additional spectrum virtually free.

Their apex body, the Cellular Operators’ Association of India, has written to telecom minister A. Raja to voice its anguish.

COAI director-general T. V. Ramachandran said, “The cost of spectrum for CDMA operators such as Reliance Infocomm and Tata Teleservices remains static at 2 per cent of the adjusted gross revenue (AGR) of their wireless business for up to 5 MHz of spectrum. For GSM players such as Bharti, Hutch and Idea, spectrum cost will be 2 per cent of AGR for 4.4MHz of spectrum; 3 per cent for 6.2MHz; and 4 per cent for 8MHz.”

Earlier, the Association of United Service Providers of India (Auspi), a CDMA operators’ body, had petitioned the telecom minister demanding that all GSM operators be made to pay for additional spectrum allocated to them beyond the 6.25MHz prescribed in their licences.

According to CDMA operators, under the unified access service licence (UASL), every GSM operator is entitled to only 6.25MHz of 2G spectrum and each CDMA operator up to 5MHz free of cost. They feel any allocation over and above this should be priced.

GSM operators have contested this and said that licences awarded by the government did not cap the spectrum allocation at 6.25MHz for GSM players.

“A high-level committee set up by the government in 2003 looked into the spectrum issue in a transparent manner and provided for an allocation of up to 15MHz for every GSM operator,” said Ramachandran.

Moreover, COAI argued that GSM players had already paid an additional 1 per cent charge on each additional tranche of spectrum that had been allotted.

“It is estimated that the GSM industry has already paid over Rs 1,800 crore on account of additional allotments of spectrum over and above the base spectrum usage charge of 2 per cent,” COAI said in its letter to Raja.

Ramachandran welcomed the CDMA lobby’s demand for a high-level probe into the allocation of spectrum to GSM operators. However, he petitioned the government to also probe the entry of CDMA operators into mobility services. He feels the Centre should explore how limited mobility WLL(M) services have morphed into full-blown mobility services.

Ramachandran referred to the 2003 judgment of Justice D.P. Wadhwa, then chairman of TDSAT, which said, “The grant of limited mobile and use of handsets is not legal.” Wadhwa had said that the licences of the fixed service providers “shall be revoked” based on the extent to which they had been modified to allow limited mobility.