New Delhi: In a major development, the government is considering allowing spectrum sharing between two mobile operators, a move that could prove to be a win-win situation for both existing as well as new telecom players.
New telecom players may find it difficult to roll out services with only 4.4 MHz of spectrum and compete with existing players who have been allocated 10-12 MHz of scarce spectrum.
Spectrum is radio frequency required by cellular operators to offer wireless mobile services.
If allowed, two new players may join hands to combine the initial spectrum taking it to 8.8 MHz and this would not only help in reducing the infrastructure costs but also result in better quality of services with less number of subscribers and more spectrum.
Minister of State for Communication and IT, Jyotiraditya Scindia, has convened a crucial meeting of senior officials in the Department of Telecom (DoT) on 8 September to consider the proposal of sharing of spectrum among other things.
According to sources, the proposal would also help the existing mobile operators who have been seeking additional spectrum with the increase in number of subscribers but are unable to get due to its scarcity.
Asked whether DoT may also consider trading in spectrum as allowed in some of the developed countries, sources close to development said since the initial 4.4 MHz of spectrum is given free of cost with the licence, it may not be possible immediately to go for trading.
New telecom players like Datacom, Unitech, Shyam-Sistema, Loop Telecom and Swan Telecom have been alloted 4.4 MHz of spectrum in six circles so far and the companies are in the process to roll out network.
One of the new operators said that sharing of spectrum, if allowed, will help the player to compete with existing service providers to some extent and asked the government to rationalise termination charges which have not been revised for last many years.
Operators charge up to 30 paise for each call terminated on their network, the new operator said, adding the telecom regulator TRAI should have reviewed it long ago to arrive at cost-based termination charge.
According to some of the exiting operators also, the termination charge should be less than 10 paise a minute but the existing players have been charging 30 paise, three times the cost based tariff.
This would be a major issue for the new telecom players to survive in the market, one of the new telco said, adding along with sharing of spectrum, government must ask TRAI to immediately review termination charge regime and recommend cost based charges.