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Tele Data

Mobile Subscribers Yearwise comparision

Dual technology operators caused losses of over Rs 519.77 billion to the National Exchequer: COAI

February 24, 2012


In a statement commenting on the ongoing spectrum pricing and allocation issue, the Cellular operators Association of India (COAI) said, “COAI would like to highlight the massive losses to the government, to the tune of over Rs 519.77 billion owing to license and related violations by the dual-technology operators in the country.” 

“In fact, dual-technology operators are beneficiaries of a decision taken by the Department of Telecommunications (DOT) between September 2007 and March 2008. Decisions taken during this period have been held to be illegal by the Supreme Court via order dated February 2, 2012. Further, allocation of dual spectrum during the said period tantamount to allocation of second license to these companies in the same service area which otherwise is not allowed as per cross holding restrictions.”

“In our view, the spectrum allocated to dual-technology operators should be withdrawn and re-allocated through fair auction process.”

“Dual Technology operators have also violated the rollout obligations, in accordance with the GSM spectrum allocated to them, as they were required to meet the same mandated by the Telecom Regulatory Authority of India (TRAI) and DoT for GSM services. These players are in severe non-compliance of the roll-out obligations even after almost three years of spectrum allocation - a serious issue deserving the same regulatory measures as is applicable to all other licensees/operators who were allocated GSM spectrum in 2008 and who may have failed to meet the licensed rollout obligations.”

“Additionally, in violation of TRAI’s mandate that CDMA operators would have to acquire the requisite spectrum in the CDMA identified bands and pay auction determined prices, these operators are offering EVDO (high speed data) services on their existing spectrum, without paying the auction prices as determined by the 3G spectrum auction. This is a gross violation of the principle of “level playing field” and has caused an estimated loss of Rs 148.23 billion to the Government.”

“The fact that dual-technology operators pay ongoing spectrum usage charges on a disaggregated spectrum basis as opposed to paying on a combined spectrum basis (as done by the GSM operators), causes a major loss to the government which can be estimated at about Rs 260 billion.”

“COAI would like to state that there is no merit in the statement made by AUSPI in a letter to DoT. Allocation of spectrum beyond 6.2 MHz has been on the basis of a stringent subscriber linked criteria and is also in strict compliance with the license conditions. DOT has on affidavit in TDSAT and on the floor of the Parliament (both Rajya Sabha as well as Lok Sabha) consistently taken a position that no spectrum in excess of what was permissible has ever been granted. Even the Annexure 55 of the One Man Committee Report that gives the details of the decision making process regarding charging of spectrum, states that the Government took a conscious decision to charge for spectrum beyond 6.2 MHz on revenue share basis instead of a one-time fee. On the basis of additional revenue share, the GSM operators have already contributed a large sum to the exchequer.”





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