Memoranda for Submission to the Chief Ministers of the Two Telugu States.


Revised Telecom Law - Allocation of Radio Spectrum


Revised Telecom Law  - Allocation of  Radio Spectrum

Dr T H Chowdary*


One of the long overdue and   most citizen friendly provision in the recently legislated  Indian Telecom Law is  the  provision for allocation of radio spectrum  not through   auctions but by  an administrative decision . The Center for Telecom Management and Studies (CTMS) which was founded in the  late 1980s  has been for long arguing  that  auctioning the radio spectrum  for telecom services   is   immoral and unjustified.   The radio spectrum used by  the service providers  is not generated    by the government. It is generated  by the licensed  companies themselves.  The government auctioning the radio spectrum which it does not  generate and therefore it  does not  own, is totally unjustified. 


2. Further  the radio spectrum is inexhaustible because the same band of spectrum can be used again and again indefinitely by   the technique of it being used  in areas  called cells  far removed from one another .


3. Sunlight  is not generated by government .  It is god -given and not owned by government. Rightly it is  not auctioned for the  generation of electrical  power.  In the  same  fashion, the radio spectrum not generated by government, ought not to be auctioned. 


4. The use of the spectrum of a given band of  spectrum can be  regulated so that  the same  band is  not used  by different  licensees  in the  same  area.  Such regulation  by government costs  and it  is that cost that can be  recovered  from the  licensed operators.


5. Currently,  the use of the   auctioned spectrum  paid for by  the buyers of the spectrum is  again  charged under the head “usage  charges”. This is like  a builder selling  a flat,   getting the   full payment and  yet   charging  for  use by  the  buyer of the flat for  living in the flat, that is purchased and paid by him.  Government should remove  this irrational and  unjustified spectrum usage  charges from the  licensed  operators.


6. The  priced paid in the auction  and the usage  charges   are recovered from the price of  the  service.  If  these are removed, the telecom services  will be  cheaper by about 40%   than what they are now. 


7. Government  should change its policy of   auctioning the  spectrum  as well as   levying the usage  charges  for the spectrum  allocated to companies.  (370 words)