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Indian operators call for TRAI to make spectrum more affordable

Indian operators call for TRAI to make spectrum more affordable

Indian regulator TRAI is under pressure to reduce the price of 4G spectrum and set out a roadmap for releasing airwaves so that operators can better plan their strategies in upcoming auctions.

The Economic Times (ET) reported that TRAI chairman RS Sharma has met with executives from five of the country’s operators – market leading trio Vodafone Idea, Bharti Airtel and Reliance Jio plus state-owned BSNL and MTNL – to hear their demands for reduced reserve prices in the 900MHz, 800MHz and 1800MHz bands. They also called for fees to be reduced across the board, as almost a third of operator revenue being paid to the government as tax.

While Sharma has reportedly agreed to work with operators on matters relating to spectrum from 2019 – including a reappraisal of how reserve prices are calculated – he noted that the base prices for the upcoming 4G and 5G spectrum auctions have already been set, and therefore would not be altered.

Vodafone Idea’s chief regulatory and corporate affairs officer P Balaji said: “The telecom regulator conducted a transparent discussion on the opportunities and challenges for the telecoms sector, and we look forward to actively working and supporting the government and the regulator’s digital agenda.”

TRAI proposed in August that 8,500MHz of spectrum to be made available across nine bands for the next – as yet undated - round of auctions, and pointedly lowered the reserve prices in an attempt to stir up interest. Prohibitively high reserve prices have deterred bidders in previous auctions, such as 2016’s 4G auction which saw 60% of the available 2,300MHz of spectrum go unsold.

Despite this, the auction raised $9.8 billion. The Department of Telecommunications recently warned that the next sale of 4G spectrum would likely fall far short of this figure, since significant consolidation has taken place in the market. Additionally, operators are struggling with debt, which in turn restricts their credit.

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