The GSMA has expressed concern about Indian regulator Trai’s recommended starting price for the upcoming 700 MHz spectrum auction. The international mobile operators’ association has argued that setting prices at reasonable levels will be key to achieving the government’s Digital India aims and called upon it to keep in mind the reasons for selling the “critical spectrum resource”.
The GSMA has expressed concern about Indian regulator Trai’s recommended starting price for the upcoming 700 MHz spectrum auction. The international mobile operators’ association has argued that setting prices at reasonable levels will be key to achieving the government’s Digital India objectives.
GSMA chief regulatory officer John Giusti said in a statement that the trade body is “very concerned” by Trai’s recommended starting price of US$1.7bn per MHz for nationwide 700 MHz spectrum – considered important for expanding mobile broadband into rural areas.
He said that operators’ limited current revenues from data services, the high cost of upgrading networks, and the competitive pressures they face make “it more challenging for [them] to recover from high spectrum prices”.
“As the digital economy becomes increasingly important to India’s future prosperity, we encourage greater focus on the long-term benefits of connecting more people in India to affordable mobile broadband, rather than on short-term financial gain,” he said.
He cited an Australian auction, in which valuable 700 MHz spectrum went unsold and unused after an unrealistically high reserve price was set, as evidence that “unrealistic” spectrum prices can discourage potential bidders.
“We respectfully ask the Indian Government and Trai to keep in mind the objectives for releasing 700MHz spectrum … in the lead-up to auctioning this critical spectrum resource,” he said.
Meanwhile, the Economic Times cited GSMA member Bharti Airtel’s managing director and CEO for India and South Asia, Gopal Vital, saying that the recommended 700 MHz starting price is “totally unaffordable”.
Indian telecoms secretary Rakesh Garg announced late last month that the country would hold a multi-band spectrum auction in May or June this year. Proceeds would be expected to surpass the record US$17.7bn raised in the 2015 auction.