Telecom operators have expressed their disappointment over the decision of the Digital Communications Commission (DCC) to approve the reserve price for the 5G spectrum as proposed by the Telecom Regulatory Authority of India. Although the industry has not officially commented on the matter as the final announcement is awaited by the government due to some pending procedural measures, it plans to write to the Ministry of Communications that pricing needs to be reconsidered if the country is to make money. The full profits of 5G technology.
The DCC, the highest decision-making body in the Department of Communications (DoT), decided at its April 29 meeting that the rates recommended by Trai did not need any downward revision. Instead, he said, operators will be given the option to buy spectrum for 20 years or 30 years.
This balancing was done by DCC because as per the recent policy, the government has to offer the spectrum with a lease term of 30 years instead of the previous prevailing 20 years. However, Trai calculated the price for 20 years and said the price for 30 years would be 1.5 times. The industry protested, noting that the price in this way is either similar to or higher than what Trai recommended in 2018, which was seen as too high. In this sense, the operators indicated the absence of a price reduction.
Seen from a 20-year period as well, Trai cut the reserve price across bands by 39% against the operators’ demand of 90%. The Cellular Operators Association of India (COAI) of the industry body highlighted that even after the cut, the reserve price continued to be very high. The industry has called for a reconsideration of spectrum pricing recommendations as there is enough room available to reduce spectrum prices by 90%, in line with global standards.
However, telecom operators are pleased with the DCC’s decision on private networks. The main body decided that the frequency spectrum would not be allocated to enterprises directly, but would have to take it from telecom companies. This would protect the operators’ revenue streams, something they have demanded. However, this issue may be challenged by the Broadband India Forum, which has been struggling with direct assignment to enterprises or should have a choice on how to acquire spectrum.
The telecom industry had said that private networks should not be allowed “for the financial viability and orderly growth of the telecom industry, which is more than capable of providing these services to businesses”.
According to COAI, if private captive networks are allowed for enterprises, the dynamics of the telecom sector will change dramatically, harming rather than improving the financial health of the industry.
Enterprise services make up 30-40% of the industry’s total revenue. Private networks once again discourage the telecom industry from investing in networks and continuing to pay high fees and taxes.”