Trai recommends 22% lower base price of Rs2,720 cr per MHz for 3G spectrum

The Telecom Regulatory Authority of India (Trai) today recommended a base price of Rs2,720 crore per mega hertz for pan-India 3G spectrum, about 22 per cent lower than the previous auction price, which mobile operators would welcome.

The government had in 2010 auctioned 3G spectrum at pan-India reserve price of Rs3,500 crore per mega hertz. Trai had also recommended that DoT put up an additional 15MHz for auction, which had to be obtained in exchange of spectrum that was with the defence services.

The Department of Telecom, however, remains optimistic of getting 5MHz of 3G spectrum (2100MHz band) from the defence ministry.

"The Authority recommends that the reserve price for 2100MHz spectrum in each LSA (licence service area) should be...Rs 2,720 crore," Trai said.

"Furthermore, the 15MHz of spectrum in the 2100MHz spectrum being vacated by ministry of defence, in lieu of spectrum in the 1900MHz spectrum, should be auctioned in view of the in-principle agreement reached with MoD, even if it is not available immediately," it added. This can be done as "actual assignments do not have to be made immediately", it said.

The regulator had recommended that DoT take all measures to ensure that the 2100MHz spectrum, which was earlier assigned to S-TEL in three service areas - Bihar, Orissa and Himachal Pradesh, was also put to auction.

Meanwhile, the telecom industry inched closer to the 1-billion subscriber base and has identified mobile internet data as the next big thing for revenue generation even as consumers were burdened with up to 100 per cent increase in charges for such services in 2014.

From a subscriber base of around 915 million at the end of last year, the industry had hoped to  reach the 1 billion mark by the end of 2014, even as different players were seen devising new ways to expand their revenue base and caught on to the growing interest among consumers for mobile internet as a big opportunity.

As the year drew to an end, Airtel came out with plans to charge extra for internet calls through VOIP applications like Skype and Viber, but had to drop the idea following a public outrage.

With more telecom players firming up plans for charging such services, Trai, which had power to control tariffs, might soon come out with regulations for messaging and calling applications.