Mobile Tariffs May Go Up With Rise In Spectrum Price: COAI

By siliconindia | Friday, 09 January 2015, 11:25 Hrs

BANGALORE: High spectrum would lead to rise in mobile services rates and adversely impact government's Digital India initiative by impeding telecom network expansion, an industry body said.

"High reserve prices will adversely impact the business viability of the operators... it will lead to increased tariffs, thereby hurting the government's targets of affordability, rural penetration and Digital India," industry body COAI Director General Rajan S Mathews said in a letter to Telecom Minister Ravi Shankar Prasad.

COAI said that telecom operators are reeling under debt burden of 2.5 lakh crores.

The association is learnt to have written same to Prime Minister Narendra Modi and his Principal Secretary Nripendra Mishra.

The Cabinet on January 5 approved a reserve price of 3,646 crores pan-India per MHz in 800MHz, 3,980 crores for 900MHz band pan-India excluding Delhi, Mumbai, Kolkata, and J&K; 2,191 crores pan-India (excluding Maharashtra and West Bengal) in 1800MHz band.

The spectrum in 900MHz band being put for auction is currently held by Airtel, Vodafone, Idea Cellular and Reliance Communications through their licences expiring in 2015-16.

The Cellular Operators Association of India said that government has increased price of spectrum in 900MHz band by 32.5 percent over price suggested by Telecom Regulatory Authority of India (Trai) and are about 107 percent higher compared to amount paid by companies for 3G spectrum in 2010.

Source: PTI