2G scam – ‘Much-a-do-about-nothing’. http://wp.me/p1ZsI2-jy
Introduction: Having been actively associated in the implementation of one of the early
GSM systems in India in 1995, I choose to remain stead fast in my opinion I had on this
subject from the inception of GSM for the following reasons:-
1. Ownership of Spectrum shall remain with government. Wireless Spectrum is a nonrenewable national resource and as such need to be handled scrupulously and judiciously by Government and Regulatory authorities. The ownership of the spectrum shall remain with Government, by allowing only its ‘right of use’ so that spectrum can be withdrawn and reallocated where it is not being put to intended use by any Agency or Operator.
2. Need to move with fast changing Technology.
What is best today will become obsolete tomorrow.Different technologies would need different frequency layer and band width making it necessary for Government and Indian telecom Industrialists to closely follow the world trends. It is an unworkable proposition to go through sell and buy process of fresh wireless spectrum every time there is inception of new technology.
3. Growth of Telecom is the need of the Nation:
As growth of Telecom in the country is more in the interest of the nation than of the Industrialists, the policies of Govt. on Service industries like Telecom need to be people centric, not money centric.
Fast growth of telecom being the prime object; it is utmost necessary for the Government to ensure its smooth operation without delays and if necessary at subsidized rates so that the service cost to end users will continue to remain low and the service is more and more available, accessible and affordable to common man.
4. Telecom growth can enhance GDP: The facts the economists need to know is that
growth of Telecom penetration across the country can contribute much more to GDP than
that with money Government can earn through selling of Licenses, Spectrum etc.
5. M&A of business houses is a continuous process. Telecom business houses are
becoming behemoths and M&As are going to be the order of the future. Therefore, the
ownership of spectrum given out on long term contract to large number of Telecom
players, will eventually end up in the hands of few business houses. It will have many
negative impacts like blocking competition, non-availability of spectrum for new
technology roll outs by fresh entrants etc.
6. Too many Network Operators will crowd the Industry. Allowing large number of Network Operators is not desirable for various reasons. Segregation of Service Provision from Network operation with more Mobile Virtual Networks (MVN) for keeping the investment costs low and better utilization of Spectrum is going to be the path of telecom growth in the future. Please see my blog: http://wp.me/p1ZsI2-t
7. Convergence will be order of the future. With the advent of LTE and other new
generation technologies making the wireless portion of the network less and less, it will
lead to convergence of Systems, Network and user devices. Please see my blog
8. De-linking Spectrum from license is impractical: The proposal of de-linking
spectrum from license will only add to the confusion about telecom license and Spectrum
allocation issues. Please see my blog. http://wp.me/p1ZsI2-3
10. Government needs Income.
No doubt, Government needs to generate income from all possible sources.
Auction can never be an option: With proposed re-farming there will be enough spectrum for all. In such a scenario of ‘Supply exceeds Demand’ auction can never be an option. Ultimately Govt. will have to give required spectrum as government cannot allow growth to stagnate for want of policies in place. Then it goes back to the mode of first-come- first- served.
What I would suggest from the vast experience I have in Telecom space, is as follows.
Government shall have a long term Pan-India Telecom policy. Its cost shall be a combination of a basic charge for the License that include ‘right of usage’ of whatever Spectrum as required from time to time.
For example; Tenure of license shall be 25 years and the combined cost for License and Spectrum usage charge could be say, Rs.75,000 Crores payable in yearly installments of Rs.3000 Crores.
In addition to this an additional charge in the form ‘revenue share’ based on active subscribers also could be levied to cater for additional quantum of spectrum needed with expansion of networks.
(P.S. The amount and tenure of license period I have mentioned above is just indicative
and hypothetical and these could be decided based on various other factors related to the
business growth and also related to economy situation in India and the world.)
The distinguishing factor in what I have suggested above from what it is now is very simple. The difference in this case is that the Licensee can upgrade or migrate and use any technology during the tenure of license and it will be the responsibility of the Government to make available the type of spectrum according to international standards as and when the licensee is in need of it with no additional cost.
See how simple the whole issue is and that is why I prefer to say that all these commotions have been “Much-a-do-about-nothing’. The fact is that Government could have earned much more in course of time than the presumptive loss figure CAG had brought up and more importantly could have avoided the negative impact it had caused and helped quicker GDP growth.
Conclusion: It is only prudent for the Government and TRAI, CAG, Judiciary etc., to take help of right Telecom technocrats with futuristic vision and knowledge, to come to proper Governmental and regulatory decisions. Otherwise it will end up in opening a Pandora’s box landing the Industry into endless litigation and hampering growth of Telecom penetration in the country if not end up in killing the industry as a whole.
Not withstanding anything said above, if any one in the Government, Politicians or in private sector enterprise indulged in misuse or corrupt practices for personal gains for self or others, law of the land shall take its own course.
Author: Abraham Paul. P. e-mail: papaul@hotmail.com Tweet @PA_Paul
