TRAI spectrum recommendations major boost to Idea, RCom; good for broadband

The telecom regulator’s recommendations on spectrum auction are likely to help Idea Cellular and Reliance Communications – two companies which were facing the highest risk of business disruption from the upcoming auctions.

The TRAI has suggested that the auction of 900-1800 MHz spectrum be put on hold till issues around the availability of 3G spectrum and other subjects are not resolved.

Once more 3G spectrum is made available, Idea Cellular and RCom face a lower chance of business disruption as other operators will focus on the 3G spectrum instead of trying to outbid Idea and RCom. Idea has 9 circles expiring, while RCom has 7.


The key parts of the recommendations are as follows:

1) Restrict defence reservation to 20 MHz in the 1800 MHz band and auction the remaining. In case more than 20 MHz has been given to defence in 1800 MHz band, get the excess released through negotiations

2) Expand 3G spectrum in the 2100 band from 20 MHz at present to 60 MHz and club this spectrum for auction with the others. This would increase 3G capacity all over India by three times. From four players, a total of 12 3G players can be accommodated in each circle. If Defence is using 2100 MHz for communication, move them to the 1900 MHz band which is not used by telecom operators and is lying vacant.

3) Start work on auctioning 700 MHz band spectrum for broadband.

4) Take back 1.2 MHz spectrum in 900 MHz band in all areas except in Punjab to accommodate high expected demand in the auction.

If it is implemented, this would more than double the total spectrum available in the upcoming auction and give a big boost to India’s broadband sector.

The following are TRAI comments about the need to release and auction more 3G spectrum:

“In India, out of 2×60 MHz available in the 2100 MHz band, only 2×25 MHz spectrum is available for 3G services. 4 blocks of 2×5 MHz (total 2×20 MHz) has been assigned in all the LSAs while the 5th block has been assigned in five LSAs (Punjab, Bihar, West Bengal, Jammu & Kashmir and Himachal Pradesh) and is available with DoT 10 Global mobile Suppliers Association’s (GSA) report on ‘GSM/3G Market/Technology Update’ dated 13th February 2014 5 for assignment in the remaining 17 LSAs.

“Keeping spectrum unassigned to any TSP amounts to commercial loss to the Government both upfront as well recurring charges in form of licence fee and spectrum usage charges. Moreover, there is not a single TSP (telecom service provider) which has 3G spectrum in all the LSAs (licensed service areas).. a number of TSPs have requested the Authority to facilitate the release of additional spectrum in the 2100 MHz band so that they can have pan-India 3G spectrum (apart from an add-on to their existing spectrum holdings).

“In the absence of spectrum in the 2100 MHz band, these TSPs would have no choice but to bid for the 900 MHz band spectrum. Though it cannot be inferred that if the 2100 MHz band spectrum is made available, then these TSPs would not like to have 900 MHz band spectrum; but, surely, their dependence on 900 MHz would not be that much.

“In view of above, it is critical to make additional spectrum available in the 2100 MHz band. The only possible way to further augment availability of spectrum in the 2100 MHz band is through vacation by Defence.

“The DoT and Defence have agreed to share 300 MHz bandwidth in the 1700-2000 MHz band with each retaining 150 MHz. The DoT’s share consists of 2×55 MHz (i.e. 110 MHz) in 1800 MHz band. It also includes 15 MHz of spectrum in the 1900 MHz band.

“Now spectrum has been delinked from the licence and licensees have to obtain the spectrum through the market process. Therefore, the Authority is now of the view that its earlier recommendations for reserving the 1900 MHz band for the refarming of 800 MHz band spectrum are no longer relevant.

“Moreover, there is a steady decline in the number of CDMA subscribers in the 800 MHz band. In comparison, as discussed above, the 2100 MHz band is a globally harmonized band with a mature device eco-system. Therefore, the Authority is of the opinion that the entire 2×60 MHz in the 2100 MHz band should be made available for commercial use. If required, Defence may be assigned spectrum in the 1900 MHz band (1910- 1920/1980-1990 MHz). This matter is of utmost importance, therefore it must be taken up at the highest levels and the vacant 3G slots should be put to auction along with the auctions of the 900 and 1800 MHz band.”