DoT approves Trai's 3G proposal

NEW DELHI: Amid reports of a possible delay in release of spectrum by the defence forces, Department of Telecom is understood to be going ahead with regulator Trai's recommendations on auctioning the airwaves with a reserve base price.

DoT is quite positive to the recommendations submitted by the telecom regulator on the auction of 3G spectrum, sources said.

3G, the generic term for next generation mobile services, will enable operators offer seamless service for applications like Internet browsing, mobile TV, e-mails, video streaming.

Given the (successful) experience in 2G spectrum (voice telephony as well as normal data services) and taking the current scenario into a totality consideration, Trai's 3G proposals can be a given a consideration, they added.

But the views of the other sides, which consider the proposal as a return to the earlier licensing regime when telecom companies bid higher for licenses would also be taken up in the right earnest, they said.

Cellular operators will be disappointed if the current Trai recommendations are implemented.

The Expert Panel working on finalising the allocation of 3G-spectrum policy for telecom companies is planning to come up with its findings on 3G allocation and pricing by December.

The Telecom regulatory Authority of India (Trai) had recommended a base price for allocation of spectrum for 3G at Rs 80 crore for Delhi and Mumbai, Rs 40 crore for Chennai and Kolkata and Rs 15 crore for other C category cities.

"Even though there is a strong possibility of DoT going along with the Trai recommendations, we will have to work out the pricing for allocation. If this pricing model is adopted finally, DoT would generate a revenue of around Rs 1,400 crore from the base price alone," a source said.

In the first round, DoT is planning to reserve at least one of the five spectrum slots for PSUs like BSNL and MTNL, which leaves just four slots of 5 Mhz each for the private players. Operators have to bid for the spectrum for 3G services.

Ministry of Communications has also given a positive signal to the recommendations filed by the regulator. Minister for Communications and IT Dayanidhi Maran had also proposed to launch 3G mobile services in the second half of 2007.