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Telcos request reduced spectrum prices and eased rollout obligations from Modi 3.0 government

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In Short:

India’s telecom industry is concerned about high spectrum prices and wants the government to intervene. They believe that lowering costs will help them use resources more efficiently. The industry also wants 6 GHz spectrum for future 6G networks and is urging regulatory action against OTT players who use networks heavily without bearing costs. There are also challenges like equipment theft and certification issues that need to be addressed.


Telecom Industry Appeals for Lower Spectrum Prices and Regulatory Intervention

With the dawn of a new government era, **India’s telecom industry** is raising concerns about the high spectrum prices in the country. They are urging regulatory bodies to step in and align costs with global standards while also removing minimum rollout obligations. According to the Cellular Operators Association of India (COAI), these changes would enable telecom companies to utilize spectrum resources more efficiently.

Challenges Faced by Telecom Sector

Despite substantial investments in 4G/5G infrastructure, telecom service providers in India continue to struggle with one of the lowest Average Revenue Per User (ARPU) rates worldwide. COAI highlighted that India’s spectrum costs as a percentage of annual recurring telecom revenues are significantly higher compared to leading global markets such as China, Germany, the UK, Brazil, and even neighboring Pakistan. Citing research from CLSA, COAI emphasized the need for the Telecom Regulatory Authority of India (Trai) to revisit spectrum pricing recommendations aligned with international norms.

The telecom industry’s plea comes as the telecom department gears up for the forthcoming round of spectrum auctions commencing on 25 June, encompassing both 4G and 5G spectrum bands.

Previous auctions were postponed twice due to the Lok Sabha election, with the last spectrum auction generating a record **₹1.5 trillion** for the government.

Future Challenges and Recommendations

In anticipation of future technologies, COAI has urged the government to strategically allocate 6 GHz resources for upcoming 6G networks. The association stressed the necessity for massive spectrum resources to meet the high capacity requirements of 6G networks and support initiatives like the Bharat 6G Alliance and Bharat 6G Vision.

Telcos and OTTs

Highlighting the need for regulatory action, COAI’s director general, SP Kochhar, expressed concerns over the disproportionate use of telecom networks by large traffic generators and over-the-top (OTT) players without contributing to costs.

**Kochhar** stated that the surge in data consumption is straining telecom networks, leading to quality of service (QoS) issues and impacting Telecom Service Providers’ (TSPs) customer experience significantly.

The issue primarily revolves around large OTT players consuming substantial data without adequate contribution, impacting the government’s revenue channel estimated at around **₹10,000 crore**. The association fears this loss could escalate in the future with the rise of new AI applications and technologies in OTT platforms.

Challenges and Potential Solutions

COAI also addressed the rising concern of telecom equipment theft, emphasizing the need for effective recovery mechanisms. They underscored the importance of making additional spectrum bands available to meet the growing demands of expanding 5G networks.

The association also lauded the government’s initiatives like the Production Linked Incentive (PLI) scheme to promote telecom and networking products, which could significantly impact the sector positively.

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