The government has decided to clear the liberalization of spectrum at the rates that TRAI had previously recommended. The decision will bring in over Rs 1300 crore in revenue to the administration.
Liberalized spectrum lets telecom operators make use of any technology to supply services like 3G or 4G connectivity and additionally gives way to the trading and sharing of airwaves. The government’s move now allows telecom operators to free its administratively allocated spectrum at TRAI rates wherever the market determined price is not available.
After the actual auction takes place, the balance will have to be handed over to the government. This development will likely be music to the ears of players like Reliance Communications (RCom) which had earlier applied for the liberalization of radio waves in the 800MHz band in 20 circles a few months ago.
While RCom had paid Rs 5383 crore as the spectrum liberalization fee for 16 of these circles, it had not been able to do so for the remaining 4. The new regulation will allow it to free those as well, with PTI claiming the transaction will take place for Rs 1300 crore.
Also See: TRAI Chairman terms telcos stand on spectrum auction ‘paradoxical’
The previous liberalization system had depended on the market determined cost for spectrum to make deals. However, there were many bandwidths where this procedure didn’t apply since it was either not for sale or had never been auctioned. The new plan will allow companies to move ahead with its plans without having to constantly consult the government.