DoT may face dilemma to workout for 2G-3G revenue split

DoT may face dilemma to workout for 2G-3G revenue split
PTI
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First Published: Sun, Oct 12 2008. 02 36 PM IST
Updated: Sun, Oct 12 2008. 02 36 PM IST
New Delhi: The Department of Telecom (DoT) may find it difficult to work through the segregation of revenues between 2G and 3G due to complex splitting methods.
Even as Ministry of Finance (MoF), TRAI and CDMA operators feel the separation is tough and can give rise to revenue loss, GSM operators had told DoT that such a plan was workable, but it now appears that even COAI is finding it difficult to cite successful example for such a split.
Hong Kong, France, Greece have found the exercise quite difficult.
In a letter to its member companies, COAI Director General T V Ramachandran is believed to have said that the Hong Kong model of segregation followed by OFTA (regulator in Hong Kong) was very complex and ‘nobody appears to be happy about it’.
He even told the members that Hong Kong telcos ‘are probably going to go away from the system’.
The visiting chairman of the French Regulatory Authority (ARCEP), Paul Champsaur, told representatives of the Indian telecom industry recently that France never implemented a differential system because of the complications involved in segregation of 2G and 3G revenues.
He, however, preferred to implement a uniform 1% charge for both 2G and 3G. This is despite the policy makers in France proposing a differential system.
Greece is yet another country, which had a system of differential charges, but implemented only a uniform rate across 2G and 3G.
A COAI official said in India the gap between 2G and 3G revenue share is too wide. While in other countries the difference is hardly 1-2%. In India, it is large enough. For metros and the A circle cities the revenue share is 10% and B circles it is 8%.
Recently, DoT amended its 3G telecom guidelines and stipulated that telcos must pay 1% of their 3G revenues annually as spectrum usage charge to the government, after a moratorium in the first year.
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First Published: Sun, Oct 12 2008. 02 36 PM IST
More Topics: 3G | Revenue | DoT | Ministry of Finance | TRAI |