ASSOCHAM Reaction on Reserve Price for 2100 MHz (for 3G) Auction

The Associated Chamber of Commerce and Industry of India (ASSOCHAM) says, the high Reserve Price of Rs.3,705 cr per MHz which is 35% higher than the reasonable price recommended by the TRAI is rather unfortunate and has sought urgent review of the decision. ASSOCHAM Telecom Council Chairman Mr. T. V. Ramachandran said, this type of auction would leave less residual money in the hands of the operators for the expeditious rolling out of the much-desired expansion in the data services which are the need of the country for national economic development.

He said, data services are growing 100% y-o-y and this resulting in a severe crunch on the requisite spectrum and impairing the quality of service to the customers. He further said, concurrently, the high cost of spectrum could compel operators to raise retail prices for economic viability. Thus the public interest is impacted in more than one way due to the latest Cabinet decision.

ASSOCHAM and industry are also greatly perturbed that despite another 15 MHz of 2100 MHz spectrum having been agreed for swapping, this is not included in the auction quantity. It does not matter that it might take some more months, maybe a year, to harmonise and make the additional quantity available to operators.

Ramachandran said, even in the last 2 auctions, operators were compelled to wait for 6 months for the spectrum they had won. ASSOCHAM recommends that the current 5 MHz and the 'swap' spectrum of 15 MHz i,e a total of 20 Mhz should be put up now on 5 March for auction in order to achieve a fair and reasonable auction. It would be harmful to customer interests, healthy growth of the industry and the overall national economic development to 'throttle' the supply of spectrum for auction.

If not reviewed, the chamber says, this decision also goes against the government vision for “Digital India” wherein of the nine pillars envisaged by the government, the first is broadband highway and the Hon’ble Prime Ministers vision of affordable broadband for all and easy accessibility.



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