New Delhi: Aditya Birla Group unit Idea Cellular Ltd has moved the Supreme Court against the coming auction of second-generation telecom spectrum, alleging that the government was creating an artificial scarcity of the airwaves and a difficult environment for phone companies and consumers.
“The spectrum being auctioned is far less than they got back due to the cancellation of the telecom licences of the 4-5 operators in the February 2 Supreme Court judgement,” an executive with knowledge of the petition said on condition of anonymity because he is not authorised to speak to the media.
“They (Department of Telecommunications) are using the argument of refarming (spectrum) to limit the number of operators in the market and creating a very difficult environment,” the person said.
Interestingly, analysts are also of the opinion that the amount of spectrum being auctioned is less than ideal.
“India’s government plans to auction only approximately 66% of the total spectrum which was released after the license cancellations,” Rajiv Sharma, telecoms analyst with HSBC Securities and Capital Markets (India) Pvt. Ltd, wrote in a 17 September report on the 2G auction.
“The reason for not releasing the residual spectrum is to reserve the 900 MHz band for re-farming,” the report said. “However, our analysis suggests that if the entire spectrum were to be auctioned and a large part of that spectrum were to be released in blocks of 10MHz each, this would result in better operator interest and address the needs for spectrum to accommodate potential data growth.”