Vodafone cries foul over DoT's spectrum auction guidelines

BANGALORE, INDIA: Vodafone India (VIL) has approached Department of Telecom (DoT) expressing concern regarding the January 22, 2013 guidelines for auction and allotment of spectrum, in 1800/900/800 MHZ bands.

VIL, in a letter to the telecom secretary (Click to read: ), stated that the guide lines are in contravention of the mutual agreement contract between parties and therefore illegal. VIL upholds 'extension of license should be on mutually agreed terms'.

Vodafone, in its letter, pi=oints out that 900MHZ spectrum for such, proposed auctions includes the 'Spectrum which is presently being used by VIL for the Mumbai, Delhi, and Kolkata, circles. Since the same spectrum is already being used expeditiously and extensively in its networks, it cannot be put out for auction, in the manner stated in the guidelines, which implies forcible withdrawal of spectrum from the existing service providers.

It also adds that the guidelines have arbitrarily fixed reserve price for 900 MHz and 1800 MHz at levels exorbitantly higher than international benchmarks. In a letter sent on 17 September 2012, VIl had quoted a decision by UK telecom regulator OFCOM, which had proposed nil spectrum charges for first 20 years for 4G services in UK. ( letter, reference page 4)

T V Ramachandran, resident director, Vodafone, stated that the guidelines auction of 900MHz was in contravention of license which provided for extension on terms that are to be mutually agreed. He pointed out that Vodafone had already applied for extension of license in the service areas of Delhi, Mumbai and Kolkata and the request was pending with the DoT. He called upon DoT to provide suitable terms for extension for discussion and mutual agreement

VIL in its communication to DoT says the current guidelines are contrary to DoT's earlier decision about validity of existing UAS & CMTS and basic service licenses to be extended for another 10 years at one time, as per the provisions of the extant licensing regime. It points out that these guidelines are discriminatory in nature, as they fix the reserve price of 900Mhz at three times the price of 800Mhz, while TRAI had recommended both these bands to be treated at par .

Fixing reserve price of 800 MHZ band at comparatively low levels benefits a certain set of telecom operators.

The letter highlights that the entire auction guideline is spreading wrong signals about liberalisation of spectrum. VIL reiterates 'guidelines wrongly continue to announce that spectrum presently held is not liberalized, when spectrum has already been liberalized and has been so since 1999'. Hence, terming the entire auction guideline as unfair, illegal, discriminatory and contrary to terms of license, Vodafone India has requested the government to withdraw the guidelines.

Vodafone India has requested for extension of licenses to be expedient, in public interest and on mutually agreed terms.