Voda Seeks More ‘Quality’ Spectrum at Reasonable Price
Move to cut SUC to 3% for next auction will free up cash flows: India MD
SUNILSOOD MD, Vodafone India
New Delhi: Vodafone India has called for allotment of more “quality spectrum” at reasonable prices to help telcos cater to the needs of an increasingly data-hungry population, while backing the government’s recent policy moves on cutting spectrum usage fee (SUC) and airwave harmonisation.
In a statement on Monday, Sunil Sood, MD of Vodafone India, said the recent government move to cut SUC to 3% from 5% for the next auction will free up cash flows for the industry, which can be invested in network to improve quality of services.
“The telecom sector is severely debt laden (more than .₹ 3 lakh crore at last count and growing),” Sood said. He described the move as a “posi- tive step that benefits the industry and is also in line with Trai’s recommendation of having a uniform, minimal SUC charge for all spectrum across the industry.” Comments from Vodafone India, a unit of UK-based Vodafone Group Plc, appear conciliatory, coming at a time when its historically testy ties with the Indian government have again hit a rough patch, with the telco so far not accepting the government’s one-time offer to resolve the long-standing .₹ 20,000-crore tax dispute over the telco’s Hutchison Whampoa stake buy in 2007.
The government, on its part, has decided to challenge in a higher court a verdict in a se- parate .₹ 8,500-crore tax case, which went in favour of the carrier, a move seen by many as a consequence of Vodafone’s inaction towards the settlement offer.
It also comes at a time when Vodafone is preparing for the next round of spectrum auctions where it needs to beef up its data spectrum holdings to compete with rivals such as Bharti Airtel, Idea Cellular besides newcomer Reliance Jio Infocomm.
“Harmonising the available spectrum to offer additional quantum via auction is another progressive step by the government (after spectrum trading and sharing), to maximise efficiency of this precious resource,” he added. Harmonisation makes airwaves contiguous or ‘continuous’, which is critical for 4G services. In the process, it can also free up more airwaves, which can be put up for sale. With “consumer demands evolving from voice to data, the telecom industry increasingly needs more of quality spectrum to be made available at reasonable prices,” Sood added.