Mr Rajan Mathews, Director General, Cellular Operators Association of India (COAI)told in an Analyst meet that telecom companies paid for the spectrum was definitely on the higher side by all estimates. However, after the recent auctions in multiple bands, clarity has emerged on the long‐term scenario, (2) the auction will lead to an increase in consolidation, at least on a de‐facto basis, (3) there will be less fragmentation of spectrum because of consolidation.
Spectrum sharing and trading guidelines will be finalized in the next 6‐9 months after which we should begin to see activity across the bands 900MHz, 800MHz and 1800Mhz, as most operators will try to put together contiguous five bands to offer data services.
Over the next couple of years incremental 900MHz, 800MHz and some 1800MHz spectrum will come on line because the licenses of players such as BSNL will come up for renewal and the CDMA players will have to go through the re‐farming exercise. 700MHz is at least 2‐3 years away because it has not been globally harmonized yet. Due to substantial interest in data services, operators might add a second carrier in 2100MHz, in the upcoming auctions.
Telcos CPAEX on Building Mobile Data Networks
The capex of telecom operators has been subdued for the last couple of years, primarily because of introduction of an amendment to the licenses, which mandated that operators bear M2M responsibility for equipment that was inducted into their network (both legacy and new); this caused a backlog in terms of imports because Telcos had to expedite clearances based on the new security norms and that created a significant delays.
All incremental investments in the network are mainly for data services with the principle focus on equipment investment. Investment on the civil side (i.e., fiber optic layout, BTS, etc.) is facing obstacles mainly because of right‐of‐way issues at the state and local levels. Investment in data infrastructure will yield higher returns as compared to global peers because of – shared passive infrastructure, outsourced network management services (network equipment purchase financed by equipment manufacturer), and a move towards active infrastructure sharing.