Tuesday, February 2, 2016

#GSMA wants affordable #spectrum pricing for the forthcoming auction of the #700mhz band

 GSMA which represents the interests of mobile operators worldwide wants affordable spectrum pricing for the forthcoming auction of the 700MHz band in India.'The more mobile operators have to pay for a spectrum licence, the less capital is available to roll out new mobile networks. As the digital economy becomes increasingly important to India’s future prosperity, we encourage greater focus on the long-term benefits of connecting more people in India to affordable mobile broadband, rather than on short-term financial gain,' said John Giusti, Chief Regulatory Officer, GSMA.

The GSMA is very concerned by TRAI’s recommendation to set a starting price of US$1.7 billion1 per MHz for pan-Indian 700MHz spectrum. India has one of the lowest Average Revenues Per User (ARPU) across the world (US$2.45 at the end of 2015). Combined with so far limited revenue contribution from data services, competitive pressure on operators’ revenues and high capital expenditure2 to upgrade networks, this makes it more challenging for operators to recover from high spectrum prices. Spectrum’s greatest value does not come from high sales prices, but rather from its use to expand social and economic opportunity for all India’s citizens. In 2014 alone, the mobile industry contributed 6.1 per cent to India’s GDP.
'High reserve prices and an unrealistic predetermination of spectrum value could also reduce the willingness of potential bidders to buy the spectrum. For example, in Australia, an unrealistically high reserve price resulted in a valuable portion of the 700MHz spectrum left unsold and unused. Unused or under-utilised spectrum benefits neither the economy nor society,' he added.