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NEW DELHI: The Department of Telecommunications (DoT) is likely to prevail over the Telecom Regulatory Authority of India (TRAI) on the issue of allowing foreign players to offer 3G (third generation) mobile services. While DoT has been favouring direct entry of foreign players to boost competition, for better services and revenue generation, TRAI wants only existing players to participate in the spectrum auction for 3G services and preferred foreign players’ entry through the foreign direct investment (FDI) route.
Communications and Information Technology Minister A. Raja, who met Prime Minister Manmohan Singh on Friday and briefed him about the issues related to the much-debated 3G policy, is learnt to have got his approval on participation of global players in the 3G telecom services and also one-time spectrum pricing formula for the existing mobile operators. Mr. Raja had already consulted the Union Finance Minister, P. Chidambaram, on the two issues.
While TRAI has asked DoT to restrict spectrum auction for 3G services to existing players only, DoT had proposed entry of foreign players to bid for 3G spectrum by giving them a licence under a new category. However, this new licence would not have made them eligible for 2G spectrum to offer mobile service now available in India.
In its recommendations TRAI had said: “The existing licensees due to their available infrastructure are in a better position to deliver 3G services efficiently, quickly and at low incremental cost in the Indian price sensitive market. At present, the Universal Access Service (UAS) licence permits a foreign company to have 74 per cent foreign direct investment. With 13-14 licensees in each service area, the authority believes that any new aspirant can join hands with the existing licensees.”
Another issue that Dr. Singh and Mr. Raja discussed was regarding the pricing of 2G spectrum for existing players, which was crucial in view of entry of several new players who were recently given licences to offer mobile services.
Sources in the DoT said Dr. Singh had approved one-time pricing of spectrum for existing players, a move that is likely to generate an estimated Rs. 40,000 crore revenue for the Government.
Mr. Raja had already announced that the guidelines for the launch of 3G and WiMAX services would be forwarded to the DoT’s decision-making body, Telecom Commission, by next week and implemented after its approval.
The Hindu
Communications and Information Technology Minister A. Raja, who met Prime Minister Manmohan Singh on Friday and briefed him about the issues related to the much-debated 3G policy, is learnt to have got his approval on participation of global players in the 3G telecom services and also one-time spectrum pricing formula for the existing mobile operators. Mr. Raja had already consulted the Union Finance Minister, P. Chidambaram, on the two issues.
While TRAI has asked DoT to restrict spectrum auction for 3G services to existing players only, DoT had proposed entry of foreign players to bid for 3G spectrum by giving them a licence under a new category. However, this new licence would not have made them eligible for 2G spectrum to offer mobile service now available in India.
In its recommendations TRAI had said: “The existing licensees due to their available infrastructure are in a better position to deliver 3G services efficiently, quickly and at low incremental cost in the Indian price sensitive market. At present, the Universal Access Service (UAS) licence permits a foreign company to have 74 per cent foreign direct investment. With 13-14 licensees in each service area, the authority believes that any new aspirant can join hands with the existing licensees.”
Another issue that Dr. Singh and Mr. Raja discussed was regarding the pricing of 2G spectrum for existing players, which was crucial in view of entry of several new players who were recently given licences to offer mobile services.
Sources in the DoT said Dr. Singh had approved one-time pricing of spectrum for existing players, a move that is likely to generate an estimated Rs. 40,000 crore revenue for the Government.
Mr. Raja had already announced that the guidelines for the launch of 3G and WiMAX services would be forwarded to the DoT’s decision-making body, Telecom Commission, by next week and implemented after its approval.
The Hindu
