Should Operators Pay Fee For Spectrum

[@ksh@T 20]

Guys Recent offer By Tata Has shook The Telecom Operators By saying that It is ready to pay A hefty amt of 1500Cr as an entry fee for 3G Spectrum in 1900MHz slot. It has also alamrmed the GOVT of raising 9000Cr. as a one time revenue....What d u think abt it...

Akshat

[rakesh5295 0]

I think the spectrum should not be charged because that will keep the call rates low but at the same time i think its time for the mobile companies to [give a] cut of profits also.

one way i support charging: if it is given totally on the customer base then many a times a small company may not be able to provide 3g facilities and u never know which company rises when.

there was one time when orange had highest customer base, then came airtel and now reliance. but if reliance is barred from dialing or reciving call facility then relaince could not have emerged this big.

so either it must be available to all and if its totally [based on the] ratio of the customer base then also a option to purchase must be open.

Edited June 3, 2005 by city02

[city02 63]

spectrum is a scarce/valuable public resource hence it should simply be auctioned off to the highest bidders and help in reducing the budget deficit.

[abhay 0]

spectrum is a scarce/valuable public resource hence it should simply be auctioned off to the highest bidders and help in reducing the budget deficit.

33217[/snapback]

yeah i also belive the same the spectrum should be auctioned. even if it is not used in reducing the deficit it can be used to spur telecommunications in india and gain back the speed @ which the industry was growing a year back. after all guys the govts aim is not to support the companies but to support telecommunications it self and other thing govt should not interfear with lower tarrifs that some companiies want to offer this is the only way the teledencity in india is supposed to increase with lower tarrifs

[@ksh@T 20]

also in newspaper tommorow i had read that Govt/DoT is thinking Rs 500Cr. for spectrum allocation....Do ne other has more information abt that..do post

[Ramchi 0]

Budget deficits can be addressed by reducing the subsidies, by increasing the tax base, reducing unnecessary taxes and reduce the size of the state/central government, disinvest from lose making Public sector organizations etc...

Once the highest bidder takes the spectrum then he can literally stall the technology advancement by taking the customer for ransom. This will not benefit Indian citizens who want to be 3G customers any way. Already, government is charging each and every Mobile customers with their service taxes and adding this spectrum charges will not be taken lightly by the customers.

Edited August 31, 2005 by Ramchi

[city02 63]

Budget deficits can be addressed by reducing the subsidies, by increasing the tax base, reducing unnecessary taxes and reduce the size of the state/central government, disinvest from lose making Public sector organizations etc...

Once the highest bidder takes the spectrum then he can literally stall the technology advancement by taking the customer for ransom. This will not benefit Indian citizens who want to be 3G customers any way. Already, government is charging each and every Mobile customers with their service taxes and adding this spectrum charges will not be taken lightly by the customers.

39583[/snapback]

'reducing unnecessary taxes' will INCREASE the deficit!

'reducing the subsidies' is good economics but bad politics which the left will vehemently oppose

'reduce the size of the state/central government' is again politically impossible since wages/salaries/pensions/benefits form the biggest portion of the costs

'disinvest from lose making Public sector organizations' is again opposed by the left even if its in the CMP...

'Indian citizens who want to be 3G customers any way' this is patently untrue in the case of India - MOST customers are quite content with the cheapest possible voice services and data is barely 5% of ARPUs (of which almost 3/4th is just SMS).

[Ramchi 0]

Many people are not paying taxes just because they are not reasonable. When you reduce your tax limits and expand your tax base the number of tax evasion will be considerably less. By reducing unnecessary taxes people will have more disposable income which can impact the economy positively?

“customers are quite content with the cheapest possible voice services and data is barely 5% of ARPUs”

Ten years back people were telling that only 0.01% of the population will be using Mobile phones.

Edited August 31, 2005 by Ramchi

[Chirag 5]

Many people are not paying taxes just because they are not reasonable. When you reduce your tax limits and expand your tax base the number of tax evasion will be considerably less. By reducing unnecessary taxes people will  have more disposable income which can impact the economy positively?

39596[/snapback]

ppl dont end up paying taxes, becoz there are 101 loopholes in the tax paying structure. And mr. Chidambaram is doing all things possible to make every commoner accountable these days. Read Fringe Benefit Tax, VAT, n banks to be disclosing interests payable below 5000.

So by increasing taxes, all these yrs the government was trying to collect more taxes. Wat is more imp is to "reduce" corruption and reduce the number of loopholes in the system. And also reduce the multiple no. of "ID CARDS" and improve the efficiency of the entire system by labelling every individual of the country thru a common Social Security Number and linking every damn thing of his life to this 1 number and that wud make sure he wud never be able to evade taxes thru his multiple bank accounts, cell-phones etc etc...

[raccoon 53]

Id agree with Ramchi ...also, the most important thing here is that the govt. itself is the problem. A large govt. is like a malignant tumor! Why dont people ever ask - "why do we need so much governance?"

customers are quite content with the cheapest possible voice services and data is barely 5% of ARPUs”

If we are to accept that statement, then I guess we should be happy with post cards ...or mebbe just nice, cute homing pigeons!!

[@ksh@T 20]

‘Spectrum auction will create problem for 3G’:

Trai chairman Pradip Baijal said auctioning of spectrum for third generation mobile services (3G) would create problems and suggested issuing separate licenses for such services as an alternative. IT and communications minister Dayanidhi Maran had said that he was keen on more players entering 3G services and indicated on separate licenses for offering such services. PTI

a good sigh.......

[anujit 0]

Don't auction man. If it costs 2.5 crores to provide STD/ISD services. 3G shouldnt cost more than 5 crores for anyone!

[SexyGurl 0]

I'm disgusted by the discussion going on here ..... to even feel like commenting on it !

Give 3G spectrum for free ... Hell !

You want to gift your share, you are welcome ... but I want my 1/1billionth share of the spectrum price.

If it is conservatively priced at 2 Billion Dollars (USD) .... I Do NOT wish to give up my 2 dollars ( Rs. 90/-). Good stuff.

What I have I done to lose my 90 rupees ?

And if you count in my family it's 360 rupees ... I'd like to have a small eat-out.

[@ksh@T 20]

Finmin proposes base 3G entry fee

TIMES NEWS NETWORK

NEW DELHI: The finance ministry has proposed a compromise formula for putting a value to the scarce 3G spectrum. It has recommended that operators should be charged a base entry fee to begin with and subsequently a revenue share for the use of 3G spectrum. Trai had suggested there should be no entry fee for providing 3G services, while Ratan Tata had offered to pay a one-time entry fee of Rs 1,500 crore because it was a scarce resource.

The ministry, in its proposal, says the entry fee should not be so high that competition is throttled and the price of services becomes high. The fee should not also be so low that non-serious players accumulate the frequency.

Ratan Tata’s offer to pay Rs 1,500 crore as entry fee for 3G spectrum would have made the exchequer richer by Rs 9,000 crore, assuming the five big operators apart from Tata Teleservices paid the same licence fee. The Tatas believe that the market must place a value to a scarce resource like spectrum. Besides, it is only a one-time fee which will get amortised over 15-20 years.

Mr Tata had also said spectrum is a scarce national resource and if it is given free of cost to operators, it would not be used efficiently and some operators could also engage in its hoarding.

Finance ministry has noted that “the proposals of Rata Tata could lead to a monopolistic rollout by a few big operators.” However, it agrees with Tata’s view that the spectrum should be priced. “Free allocation of spectrum without a charge is in the nature of a subsidy, especially as the resource in question is scarce and is in great demand,” notes finance ministry.

It has said that the DoT should fix base fee in view of the fact that if the fee is too high, then there may be a cornering of the spectrum by the bigger operators. This may lead to erosion of competition.

The mobile industry is opposed to the proposal of imposing any entry fee on the spectrum. For instance, Sunil Mittal, chairman of Bharti Tele-ventures opposed it saying that it would increase price of services. He said that the country was short of high quality infrastructure. Any fee by the government would discourage infrastructure buildout. From Rs 1,500 crore, one can build 5,000 base stations and cover 3,000 small towns and villages.

........

i think there will be a massive fght between ministeries than operators

[@ksh@T 20]

Maran promises 3G, revenue share in ADC 

* Spectrum issue to be resolved by March * Tariffs set to drop further

IT and communications minister Dayanidhi Maran on Tuesday said third generation (3G) telephony in India will be opened up by March 2006. 3G allows high speed data transfer of up to 2 mega bytes per second against 10 kilo bytes per second in 2G and up to 144 kbps in 2.5G.

Addressing the India Economic Summit organised by the Confederation of Indian Industry, Mr Maran also said the government would soon shift to a revenue share regime while collecting access deficit charges (ADC) from telecom companies and passing it on to BSNL. BSNL strongly opposes such a move since it could lower its revenues by Rs 1,800 crore a year.

Mr Maran said 3G pricing by operators should be competitive. “UK and Europe have new players in 3G. We must ensure new entrants come and invest a lot of money and prices are competitive because the consumer should benefit out of it and should not be paying a hefty fee for the use of 3G.”

The government proposes to cut ADC to 2-5% of revenues from the current 30 paise per call for all inter-circle calls. This will effectively reduce ADC to just 4-5 paise per call, which can lower user costs further. “We will soon ask Trai to shift ADC to a revenue sharing basis,” he said

As far as 3G was concerned, the government was waiting for Europe to settle with HSDPA (high speed downlink packet access). HSDPA is the next generation of 3G technology.

Ever since the failure of the first round of 3G due to exorbitant bidding for 3G spectrum by telcos in Europe, there has been intense speculation over whether the 3G spectrum should be priced at all. A few months ago, Tata Teleservices chairman Ratan Tata had suggested that 3G spectrum, being a niche service, should be priced. He had proposed Rs 1,500 crore as a fee. Bharti group chairman Sunil Mittal had objected to the proposal. Mr Maran’s deadline on 3G is expected to hot up the lobbying between CDMA and GSM players as both want specified spectrum and their demand for a particular band of spectrum already clashes with each other’s interest.

WHAT IS 3G
• High-speed web
• Video-conferencing
• TV streaming
• Multi-media services
• Navigation/maps

REVENUE SHARE IN ADC 
• Deficit charge will be pared to 4 paise from 40 paise/call
• Cheaper ISD and STD calls
• BSNL to lose Rs 1,800 crore a year
• Private players to benefit

Edited December 11, 2005 by akshatdesijallad

[linuxguy 0]

whatever the greedy govt charges, the operators will overcharge us for it!

[SexyGurl 0]

Even if the govt doesn't charge anything, the greedy operators will still overcharge us.

I want my Rs. 90/- for selling my fair share of the spectrum owned by 1 billion Indians. Rest of you can give it away for free, you're welcome.

[anujit 0]

Dude. Billions of Indians dont own 1 min hertz of spectrum. So good luck selling "yours" for 90 bucks!

Edited December 13, 2005 by anujit

[SexyGurl 0]

Who "owns" the spectrum, if INDIANS don't own it ?? Chinese? Americans? or Europeans ?

The damn thing is worth atleast $ 2 Billion ... I want my 2 dollars. Damn it.

I have NIL interest in making SUNIL MITTAL, ANIL AMBANI, OR HUTCHINSON WHAMPOA richer at my expense ... They are sufficiently rich, already.

At best, I am willing to contribute my Rs. 90/- (if all other indians also contribute) .... to build a super expressway between Delhi and Mumbai ... and If it could be used to build a new power plant, outside Delhi.

In the worst case, I'll also consider, $ 2 Billion worth of Petrol to be imported .... and I get a FREE refill for a day .... at say Indian Oil's petrol pump.

You speak for yourself .... NOT FOR ME.

[Ramchi 0]

Any abnormal entry fee would definitely impact cost of services and would definitely deny multiple entries. Only monsters like TATA, Reliance and Airtel will dominate the spectrum. Customes will be forced to pay more with limited players around.

Whereas with reasonable entry fee would enable multiple players to drive the overall charges down.

Anything that goes to government will be swindled by politician and routed to Swiss bank accounts. I would rather see cheaper entry fee enabling stiff competition than getting a free refill for a day.

Edited December 13, 2005 by Ramchi

[SexyGurl 0]

Any abnormal entry fee would definitely impact cost of services and would definitely deny multiple entries.

No.

Under "free spectrum" the current 6 operators get the spectrum free.

Under market determined auction ... still SIX OPERATORS get the spectrum.

The only difference is the current "monsters" like TATA, Reliance and Airtel will not necessarily be the 3G operators.

If Vijay Mallya wants to operate 3G services and pay the market rates .... I have no extra love for Sunil Mittal over Vijay Mallya.

If Cingular (USA) or Deutsche Telekom wants to operate 3G services and pay market rate .... I have no extra love for the Chinese Hutchinson Whampoa.

Only monsters like TATA, Reliance and Airtel will dominate the spectrum. Customes will be forced to pay more with limited players around.

That is exactly what I DON'T want. If these monsters want a FREE LUNCH at MY EXPENSE. F*KK OFF.

These monsters must pay the market price .... or else GET OUT.

Whereas with reasonable entry fee would enable multiple players to drive the overall charges down.

Yes. Reasonable is the market determined rate. If the open auction proves that the market value of 3G services in India is worth less than $ 2 Billion, sure. But we should sell it even for $ 200 million.

I want my every cent ... that is due to me. 1 cent or 2 dollars. But I want the fair market price.

Anything that goes to government will be swindled by politician and routed to Swiss bank accounts.

This is interesting.

I would like all the money from the sale of spectrum be dedicated for use of extending Delhi Metro.

(Delhi Metro cost $ 1.2 Billion, mostly from an outstanding loan from Japan). We could retire the entire debt.

Or the same $ 2 Billion could be dedicated for building a similar Mumbai Metro .... or a Bangalore Metro.

No need to us to take loans from Japan.

F*kk the politicians (if they are indeed that horrendous as you claim).

I would rather see cheaper entry fee enabling stiff competition than getting a free refill for a day.

Stiff competition doesn't come from offering FREE spectrum to current monsters like TATA, Reliance, Airtel and Hutch.

Free competition comes from: LET THE MARKET DECIDE. No subsidies to current monsters.

Edited December 13, 2005 by SexyGurl

[Ramchi 0]

"Under market determined auction ... still SIX OPERATORS get the spectrum."

What if only two players able to pay this heavy entry fee? What if they take the customers for ransom? This is already a proven exercise and our experience with pre-historic P&T department [bSNL] clearly tells us the same.

When BSNL was the only Landline provider the teledensity was hardly 1% or so. Now we have so many providers look at the teledensity. Forget Teledensity, even to get a telephone connection we waited for centuries.

By bringing in the heavy entry fees will NO way help opening the market segment for more players.

“Or the same $ 2 Billion could be dedicated for building a similar Mumbai Metro .... or a Bangalore Metro.No need to us to take loans from Japan.”

Please smell the coffee, this is THE most corrupt country in the world called as India. Indian government is already heavily taxing their citizens (I mean, sincere, hard-working, middle-class segment) they can definitely generate money for infrastructure development projects thru other means as well.

“Stiff competition doesn't come from offering FREE spectrum to current monsters like TATA, Reliance, Airtel and Hutch. Free competition comes from: LET THE MARKET DECIDE. No subsidies to current monsters.”

There will not be any competition at all when only two or limited number of providers operating in the market. I am pretty sure that hefty entry fee would make this undesirable situation quite possible.

Free or nominal entry fee would definitely encourage more players to pitch in and after that as you say, market will decide the future.

[SexyGurl 0]

"Under market determined auction ... still SIX OPERATORS get the spectrum."

What if only two players able to pay this heavy entry fee? What if they take the customers for ransom? This is already a proven exercise and our experience with pre-historic P&T department [bSNL] clearly tells us the same.

When BSNL was the only Landline provider the teledensity was hardly 1% or so. Now we have so many providers look at the teledensity. Forget Teledensity, even to get a telephone connection we waited for centuries.

By bringing in the heavy entry fees will NO way help opening the market segment for more players.

There is no entry fee .. HEAVY OR LOW. Fee has to be FAIR. Market determines what's fair.

If the highest six bids received are Rs. 1 crore each .... that is fair.

If highest six bids received are Rs. 1500 crore each .... that is fair.

It's for the bidders to decide, what is fair. It's perfectly possible Tata bids Rs. 1500 crores and gets 1/6th share of the spectrum.

Other 5 bids are all Rs. 1 crore ... and each of those 5, still get 1/6th spectrum.

I see no reason why we should not take 1500 crores from TATA .. it's damn good money. But if someone is willing to pay even more than TATA ... then TATA is out. What counts is money.

“Or the same $ 2 Billion could be dedicated for building a similar Mumbai Metro .... or a Bangalore Metro.No need to us to take loans from Japan.”

Please smell the coffee, this is THE most corrupt country in the world called as India. Indian government is already heavily taxing their citizens (I mean, sincere, hard-working, middle-class segment) they can definitely generate money for infrastructure development projects thru other means as well.

Yes, more money for infrastructure can be and should be generated by selling spectrum.

You are a part of the corrupt country called India.

“Stiff competition doesn't come from offering FREE spectrum to current monsters like TATA, Reliance, Airtel and Hutch. Free competition comes from: LET THE MARKET DECIDE. No subsidies to current monsters.”

There will not be any competition at all when only two or limited number of providers operating in the market. I am pretty sure that hefty entry fee would make this undesirable situation quite possible.

Read above. There is no hefty fee. Market pays only the fair price. The highest six bids win.

Rest go to the dustbin. Fair and Square ... no leniency for anyone, especially the current monsters who want FREE spectrum.

Free or nominal entry fee would definitely encourage more players to pitch in and after that as you say, market will decide the future.

FREE means only the current SIX monsters are given the spectrum free. Anyone outside the current Six, is automatically disqualified to be considered (even if more efficient and capable in providing quality services).

FREE means TATA, Reliance, BSNL each get 1/6th of the spectrum FOR SURE. So, do Airtel, Hutch and Idea.

OPEN COMPETITION means BSNL could lose the bidding and be out of 3G domain, being replaced by a private service provider. Same holds for TATA, Reliance, Airtel and Hutch.

OPEN COMPETITION means DoCoMo (Japan) could be providing the 3G services in India, similar to what it's doing in Japan. Or Korea Telecom could bring highest standard CDMA 3G services to India.

Edited December 14, 2005 by SexyGurl

[shashank 8]

Who is going to pay more than TATA?????? Its none.I dont think someone will even pay Rs.200crore.

And on more thing is even though TATA pays 1500crore they will not increase charges for 3Gservices.

And if TATA get more spectrum you can understand what will happen as it is a CDMA network!!!!!!!!!!

[Ramchi 0]

I am not asking any one to lose the money. It can be done thru revenue sharing. No operator would say no to that as against investing huge amount. This would encourage many players to enter the market.

It is a proven fact that license raj was disastrous for India. I do not want to go thru that freaking mess again.

If TATA, Reliance or Airtel are not comfortable with competition, let them leave the business and go to hell. We know how Indian entrepreneurs black-mailed Indian customers with their substandard products & services.

Until few years ago, when these marwaris like Bajaj, Tatas were doing business, only they had the royal right to screw Indian consumers. I still can not forget those days where we waited for 10 long years of booking period to purchase miserable Bajaj scooters. When they faced with stiff competition they moved their @ss out to make new models.

Same is applicable to our P&T and others. Let them face real competition with more vendors.