New battlelines have been drawn out in the telecom sector with Bharti Enterprises Chairman, Sunil Bharti Mittal, on Tuesday joining Mukesh Ambani and Kumar Mangalam Birla, to make a strong case for a licence fee and pricing satellite spectrum to create a level-playing field with traditional mobile operators.
This puts the three big Indian business honchos directly in confrontation with American tech honchos including Elon Musk and Jeff Bezos who have been asking for administrative allocation of spectrum to launch satellite communication services in India.
Speaking at the India Mobile Congress 2024 (IMC 2024) in Delhi, Mittal said, “Those satellite companies who have ambitions to come into urban areas serving elite retail customers need to take the telecom licences like everybody else, be bound with the same conditions. They need to buy the spectrum as the telecom companies buy.”
Such companies need to pay the licence fee as the telecom companies do, and also secure their networks like telecom companies do, he said. “This is a simple solution which can be done on a global scale and India can again show the game in this particular regard,” Mittal said.
Mittal’s statement assumes significance because he has an interest in both satellite communication business, through OneWeb, and traditional mobile services, through Airtel. So far, OneWeb has been siding with Musk’s Starlink and Bezos’ Kuiper Project in asking for administrative allocation of spectrum.
Airtel, however, downplayed Mittal’s statement saying that there is no change in stance. “Satellite operators who want to provide services to urban areas and retail customers indeed need to go through the regular licensing process of any country, and in this case, India, to obtain a licence; buy the spectrum; undertake all the obligations, including rollout and security; pay their license fees and taxes and they would be welcomed by the telecom fraternity,” Airtel said in a statement.
Experts said that Mittal may have decided to protect his Airtel investments as Musk’s entry could threaten the mobile operator’s market share. “Sunil Mittal is understandably torn between his interests as a major incumbent telco and an emerging satellite player. He feels more threatened as the former,” said Mahesh Uppal, Director, ComFirst India.
Jio’s stance
Last week, Ambani’s Reliance Jio had written to Telecom Minister Jyotiraditya Scindia opposing the Telecom Regulatory Authority of India (TRAI’s) tilt towards allocating satellite airwaves sans auction. Kumar Birla-backed Vodafone Idea has already told TRAI that it was in favour of auctioning spectrum.
Jio had urged the Minister to direct TRAI to conduct a “comprehensive evaluation of the technical and economic feasibility of spectrum auctions for satellite services”, considering the convergence of technologies and services.
Meanwhile, Minister Scindia said that satcom spectrum will be allocated administratively as mentioned in the Telecom Act of 2023.
“The Telecom Act of 2023, which was passed in December of last year, has very, focused on schedule one, which means that satcom spectrum will be allocated administratively. Now, that does not mean that spectrum does not come without a cost. What that cost is and what the formula of allocation is going to be, will not be decided by you or me. It will be decided by TRAI,” Scindia said, adding that satellite spectrum across the world is administratively allocated.
“Conversely, if you do decide to auction it, then you will be doing something which is different from the rest of the world...Satellite spectrum is shared spectrum. Now if spectrum is shared then how can you price it individually? So I think there are a number of issues that go into making that decision, which is why, globally, all countries in the world followed a certain part, and India is doing pretty much the same,” Scindia added.