The next round of spectrum auction, scheduled to be held by the middle of this year, will ensure there is plenty of spectrum available with operators which will help improve the voice and data
services for customers, in addition to helping government to get mobilise resources to meet its 2016-17 fiscal targets.
Spectrum is airwave required to connect mobile devices wirelessly for sending voice and data. It is the precious raw material for telecom operators like coal and gas are for power generation.
They can be categorised on generation of technology as 2G, 3G, 4G based on the band of radio waves they use. Broadly they are categorised in 800, 900, 1800, 2100, 2300 and 2500 megahertz. The latest being 700 MHz under consideration.
According to Wireless Planning Commission that manages spectrum in India, all telecom operators in the country as on July 31, 2015 hold 4802.20 MHz of spectrum across various bands.
Spectrum in large quality was commercially given out in India first in 1995 (under National Telecom Policy 1994) when cellular mobile telephone services (CMTS) were launched. It was based on number of mobile phones (later Subscribe Identification Module-SIM) issued by an operator.
The spectrum charges were part of CMTS licence. There was no separate upfront spectrum charge for allocation of licence as the government’s aim was proliferation of telecom services.
However, with proliferation of new technologies (earlier it was only global system for mobile communications (GSM) like code division multiple access (CDMA) and long term evolution (LTE), the demand for spectrum increased manifold.
But, its supply was low, since the defence segment that controls the maximum spectrum was not willing to vacate it.
To ensure operators use spectrum efficiently in August 1999, spectrum charges were linked to percentage of adjusted gross revenue (AGR) (based on NTP 1997) that operators pay to government. On September 22, 2001 cellular operators were asked to pay a spectrum charges on revenue share basis at the rate of 2 per cent of AGR annually.
In the Unified Access Services Licence (UASL) introduced on January 13, 2005, spectrum charges and entry fee were not separated.
In 2008, spectrums were allocated on first-cum-first serve basis. Spectrum auction was again held in 2010. This was known for 3G and 4G spectrum auction.
The Supreme Court in February 2012 canceled 122 telecom licences issued in 2008 as it found the allocation of spectrum to be faulty. The Government was asked to hold auction in next four months.
The Government held spectrum auction in March 2015, allowing trading and sharing of spectrum. This should help operators to manage network efficiently.
Next round of auction is scheduled in June 2016.