The so called Indian Empowered Group of Ministers (EGoM) who slept over the 2G Spectrum Scam now have decided on partial re-farming of the 900MHz spectrum, wherein incumbent operators [Airtel, Vodafone, Reliance Telecom(GSM), Idea] can retain up to 2.5MHz of spectrum and have to surrender the remaining spectrum for auction. Why just 2.5MHz ? Since they have already rolled out services, let them continue so there is no disruption of services. And to strike a balance with new operators, let them win 2.5Mhz in a separate auction, seems to be the logic. 900MHz spectrum will have to be pooled in for auctions before the respective renewal period. However, this is not final and TRAI is likely to issue a consultation paper and then recommend suitably to the DoT.
Pricing of 900MHz The 900MHz Spectrum is currently recommended to be base priced at 2x the 1800MHz while 800MHz in the Current 2012 Auction is Priced at 1.3X 1800MHz. I wonder what makes the 900MHz so pricey compared to 800Mhz when the characteristics of the latter are better than the former. Is the TRAI looking into the lucrativeness of the service or profitability of operator ? So tomorrow, if Reliance Infotel is to make supernatural profits from 2300MHz BWA / LTE services, TRAI gonna make the base price for renewal higher than 1800Mhz as well ? Ridiculous, in my opinion.
Impact of Spectrum Rearming on Operators Spectrum re-farming will call for redesigning of existing networks, mainly through the replacement of base stations, commonly known as telecom towers. I’m not sure but partial re-farming still seems to be better than full re-farming, the implications of pricing is worse. This will lead to increased capex required to set up new base stations and replacement of earlier sites on the 900MHz frequency band; and additional expenses incurred due to rentals on the new sites.