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RCom,Vodafone protest over spectrum surrender intensifies
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Reliance Communications and Vodafone Essar, the second and third largest telecom operators in India, are sparring over the issue of spectrum management and future allocation of 2G spectrum. Recently, RCom expressed its willingness to surrender 1.8 MHz of GSM spectrum in the Bihar circle, provided telecom regulator Trai ensures that other operators also surrender spectrum in excess of 6.2 MHz in each circle. That sparked off protests from rival telco Vodafone, which called RCom’s case “fundamentally inconsistent”.

In its latest presentation to Trai, Vodafone has said that RCom has more than 6.2 MHz of spectrum in every circle and is in fact holding more than Vodafone in 19 circles. The company’s presentation, a copy of which is with ET Now, said that RCom’s average spectrum holding is 9.4 MHz, much higher than the 6.2 MHz that it has proposed for all operators. In its presentation, Vodafone also said that “the operator, which has been most vocal about hoarding, already has 50% more spectrum than VEL (without taking CDMA efficiencies into account)”.

All future allotments of 2G spectrum have been put on hold by the department of telecommunications (DoT) till the government gets a fix on how future allotments will be made. DoT had asked Trai to give recommendations on allotment criteria of 2G spectrum. While CDMA-to-GSM operators like Tata Docomo and RCom are in favour of the current procedure of allotting spectrum on the subscriber linked criteria, GSM incumbents like Vodafone and Bharti are in favour of an auction. “If the government doesn’t decide to auction additional 2G spectrum, the exchequer stands to lose as much as Rs 10,000 crore,” said a senior official of a leading GSM telco.

The other key issue dividing the industry is that of how much spectrum should be given to operators. While operators like Tata Docomo and RCom have proposed to Trai that there should be a one-time levy on operators which have more than 6.2 MHz of spectrum, Vodafone and Bharti Airtel, the two operators that hold more than this amount of spectrum in several markets, including Delhi and Mumbai, contest this claim.

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