 "Telecom Commission sides with telcos on TRAI")
**New Delhi:**Close on the heel of almost theentire telecom industry decrying TRAI’s recommendation for 2Gauction, the Department of Telecommunications today asked thesector regulator to explain how it had arrived at the steepbase price for the 2G spectrum sale.
Telecom Commission, the highest decision making body inthe Department of Telecommunication, sent detailed comments onTRAI’s recommendations for auction of 2G spectrum releasedfrom cancellation of 122 licences by the Supreme Court, andasked the regulator to reply within a fortnight.
[caption id=“attachment_297722” align=“alignleft” width=“380” caption=“Reuters”]
[/caption]
In a communication to Trai, DoT has sought clarificationon the “basis on which the efficiency factor and otherindicators of the price has been derived,” in fixing the baseprice for spectrum in 800 Mhz and 1800 Mhz bands due for
auction.
“…especially keeping in the view the multiplicationfactor of 1.5 for 800/900 mhz bands prescribed by Trai in itsrecommendations of May 2012 and February 2011,” DoT furtheradded.
Telecom service providers have been allocated spectrum in800, 900 and 1800 Mhz bands for providing 2G mobile services.Trai has suggested a base price of Rs 3,622 crore forone megahertz (MHz) for pan-India spectrum. This is around 10times higher than the price at which 2G licences bundled with
4.4 MHz spectrum were allocated in 2008 under the then TelecomMinister A Raja.
The regulator further said that the price of spectrum in800 Mhz and 900 Mhz should be twice the price of spectrum in 1800 Mhz. In its earlier recommendation, it said price ofspectrum in 900 Mhz band should be 1.5 times the price ofspectrum in 1800 Mhz band.
Industry body Cellular Operators Association of India (COAI) today raised question on these change in the multiplicationfactor while calculating the base price of spectrum by Trai.“In May 2010, regulator came out to set 2G prices in line
with 3G prices as basic minimum bidding price. In may 2010 weheard that 900 (Mhz) band should be 1.5 times of 1800 Mhz…Now in April 2012 it should be 2 times. We are confused..which methodology is right,” COAI chairman and Bharti AirtelCEO Sanjay Kapoor said.
Telecom companies have been protesting against the steephigh prices recommended by Trai.
Heads of leading telecom companies on Wednesday met topgovernment functionaries, including Home Minister PChidambaram and Finance Minister Pranab Mukherjee, urgingthem not to accept the regulator’s “catastrophic” recipe as itcan kill whole telecom industry.
PTI