Delhi: The Union government is expected to announce the long-delayed final guidelines for mobile phone companies to offer 3G, or third generation, services in the next one week, telecom minister Andimuthu Raja said on Friday.
“Broad guidelines are ready,” the minister said. “I will meet the Prime Minister and finance minister for some consultations. Then it will be placed before the telecom commission for notification within a week,” Raja said.
Raja met Prime Minister Manmohan Singh late on Friday for discussions including the schedule for the auction of spectrum, or airwaves, for provision of 3G services “He consulted the prime minister on the issue of allowing foreign players and also on the auction schedule,” said a senior official in the communications ministry, asking not to be identified.
The announcement of 3G policy has been delayed after the telecom regulator objected to the proposed entry of new foreign telecom firms, arguing that existing companies will be able roll out the services much faster. The finance ministry favours opening up the bidding for new aspirants to spur competition and earn more revenue through licence fees.
3G technologies enable mobile-phone operators to offer users a range of advanced services including video calls and broadband wireless data transfer at high speed. The proposed guidelines will also cover so-called WiMAX services that include high-speed wireless broadband.
The auction of spectrum will be conducted by an independent agency. State run operators, Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd will get one block of spectrum at a price equal to the highest bid. All telecom service providers who fulfill the criteria for obtaining a Unified Access Service Licence will be allowed to bid for spectrum. The successful bidder will be alloTted airwaves for 20 years.
If an existing mobile phone operator wins a bid and the licence for its operation is due to expire before 20 years, the licence will be extended. New operators that bid successfully won’t be allowed to offer 2G services, the predecessor to 3G, or basic mobile telephony.
There will be no spectrum charge for 3G services in the first year from the date of allotment of the airwaves although the operators will be required to pay an annual spectrum charge of 1% of annual gross revenue after the moratorium ends. Spectrum trading or sharing will not be allowed.
The government is considering levying a spectrum hoarding charge if phone firms do not meet their rollout obligations. In the first year, the operators will be fined 2.5% of their winning auction bid per quarter.