Telcos ask Trai to review formula for valuing spectrum
The Telecom Regulatory Authority of India (Trai) will float a consultation paper on spectrum valuation after operators requested for a review of the existing methodology. The paper will also discuss issues such as sharing and leasing of spectrum.
“Operators feel that the current methodology for spectrum valuation has deficiencies...so we have decided to issue a consultation paper on what should be the basic principles for valuation of spectrum, how often should the government conduct auctions...Leasing, sharing, surrendering of spectrum, all these things will be deliberated upon,” said Trai chairman RS Sharma, after the meeting telecom operators on Wednesday.
On several occasions, the operators had told the government and the telecom regulator that the spectrum price is too high compared to other countries. For example, Trai in its recommendations in August, had suggested the auctioning of 20MHz blocks in the 3,300-3,600MHz band for 5G services at ₹492 crore per MHz. In South Korea, the same band was priced at around ₹131 crore per MHz during June auctions.
Issues pertaining to high levies and goods and services tax (GST) refunds were also raised during Wednesday’s meeting. Telecom operators pay 3-5% and 8% of the adjusted gross revenue as spectrum usage charges and licence fees to the department of telecommunications. The GST rate on telecom services is 18%.
The regulator met officials from telecos, including Vodafone Idea, Reliance Jio and Bharti Airtel, to finalise industry-specific issues for discussions in 2019.
“This (exercise) has become more important as we have a new digital communications policy. There are lot of statements in the policy which will require deliberations. We wanted to consult with telecom operators to find out their views on what should be priority areas,” Sharma said.
Trai will also develop a framework for quality of services norms for Internet of Things (IoT), besides creating infrastructure, including the laying down of fibre optic cables, which is a key mandate of the centre’s national digital communications policy.