Last year in November, the telecom ministry had put forth the implications of 3G sharing. Telcos were accused of illegally delivering 3G services to their customers, even in regions they did not have license for, by signing 3G sharing agreements with other telcos. DoT stressed on having 3G sharing halted, immediately. Telcos, on other hand felt that it was a breach of the contract signed during the action of 3G services, and even demanded their money back. This could bring some relief, if not completely, the Telecom Commission, a decision-making body of the communications ministry, has now declared that it will allow mobile phone companies to share spectrum, though, it will be limited only to 2G. So, clearly, telcos cannot share the 3G spectrum.

Illegal 3G sharing

Spectrum sharing with conditions

Basically, some operators enable their customers to access 3G by sharing airwaves when in another state that does not permit them to offer 3G services. After the government terming it as illegal, Sunil Mittal of Bharti Airtel, Kumar Mangalam Birla of Idea Cellular and Vodafone Group CEO, Vittorio Colao, even wrote a letter to the PM stating that, “in the event that 3G Intra-Circle Roaming (ICR) is now deemed impermissible, then, it would be a clear breach of our contract and the pre-auction confirmation given by the government.

Reportedly, telcos aren’t aware of this decision as the government hasn’t announced it yet. This isn’t all! The Telecom Ministry has also announced that operators with airwaves in particular regions only can share it. For example, Uninor or Tata Teleservices who do not have 2G spectrum in Delhi cannot share airwaves with operators who have radio frequency there and launch GSM-based cellular services and the spectrum can be shared only between two spectrum holders, reports The Economic Times. Moreover, two companies can share airwaves, if their combined holdings do not exceed the limits in the M&A norms. TC says that when telcos share spectrum, the usage charges need to be paid by both companies.

In order that payment of current price does not act a disincentive, licensees may be permitted to pay the current price applicable on the date of permission, on an annual basis, instead of for five years at a time, and this payment will cease if the sharing agreement is annulled midway,” the minutes of the TC meet stated. The telcos sharing spectrum need to pay the government the commercial value of the airwaves that it utilizes.

Publish date: January 31, 2012 11:10 am| Modified date: December 18, 2013 9:29 pm

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