Monday, July 19, 2010

Indian Regulator TRAI Announces the Spectrum Allocation Policy Recommendations

After a brief consultation process which began in previous years , the TRAI has given its recommendations to the government on the spectrum allocation or auction Policies in the 3G bands as well as 2.3GHz, 2.5-2.69Ghz and 3.3-3.4 Ghz bands.

If any of the potential WiMAX operators or wireless ISP were expecting sunny days ahead with potential licensing of hundreds of megahertz of spectrum in bands which form the prime ones for mobile WiMAX, they were sorely disappointed by the recommendations. This is not funny for a country where the broadband penetration has stagnated at 10 million after over a decade since when internet was available. With the incumbent BSNL and MTNL having control of over 80% of the fixed lines, the new operators were banking on wireless or WiMAX technologies to take them ahead.

The regulator has relied on the WRC-07 recommendations on adopting the OFDMA-TDD as one of the approved air interfaces under the IMT2000 to bring in the mobile operators amongst the select set of operators which can bid for such spectrum.

The following are the key features of the recommended policy:

(i) Vacation of the 2.5-2.69 GHz spectrum Slot: As a first step in the process of raking in the proceeds of the potential auction of this band the existing licensees have been recommended to vacate this band and be relocated in the 3.3-3.4 GHz band.
(ii) A Hold on allocation of the 3.4-3.6 GHz band till the potential interference with lower extended C-Band satellite communications can be decided upon.
(iii) Auction of the 2.1 GHz, 2.3 Ghz and 2.5-2.69 Ghz bands. The later two bands to be also opened for UASL operators and ISPs while the 2.1 Ghz is exclusively for 3G operators.
(iv) No eligibility for broadcasters or cable operators for any of the bands of spectrum
A very low reserve price for spectrum: While opening up the new bands for UASL and cellular mobile operators the reserve pricing of spectrum has been kept well below the global levels for unspecified reasons.
The reserve price of 15 MHz of spectrum for Category A, B and C Circles has been kept at $15 Million,$7.5 Million and $2.5 Million respectively for category A, B and C circles. Hence for a countrywide footprint with all circles, the reserve price does not exceed $ 100 million, which is well below even that used for GSM.

In TRAI’s own interpretation of the WRC recommendations, because the WiMAX has been approved as one of the permitted interfaces under the IMT-2000, the WIMAX operators should be evicted from this band and this band should be opened to mobile and UASL operators.
The 2.5-2.69 Ghz spectrum was earlier the MMDS band which was used to distribute the TV signals via a wireless medium. Today the WiMAX permits the same facility for Wireless TV to be delivered to mobile handsets and local communities.
The recent JV of Clearwire, Sprint Nextel, Comcast and Time Warner in the USA has explicitly set aside 5 MHz of spectrum for delivery of Cable TV wirelessly to users.

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