The Telecom Regulatory Authority of India (TRAI) should tread carefully while formulating the rules for auctioning spectrum for satellite-based communication services. While an auction mechanism brings in transparency into the spectrum allocation process, no other country has attempted to sell airwaves for satellite services.

Unlike mobile services, satellite communication networks do not need dedicated spectrum resources. Most satellite players in other countries operate by sharing spectrum resources. Satellite players have warned that any move to auction spectrum would cause segmentation of airwaves and drive down the efficiency of broadband services. Satellite spectrum allocation is also more complicated than its terrestrial counterpart because it needs global coordination. On the other hand, telecom operators are pushing for an auction mechanism to ensure a level playing field in the market since satellite service providers will end up competing with mobile operators for a pie of the booming broadband market. They also cite the Supreme Court order mandating auctioning of spectrum, in the aftermath of the 2G scam. The TRAI will have to find a balance between the technological drawbacks of auctioning satellite spectrum and the need for adopting a process that is non-arbitrary and transparent so that users can get access to satellite communication services at an affordable price. The main advantage of satellite service is that it can provide high-speed internet access in remote areas, where terrestrial networks cannot be set up, for instance in rugged unreachable terrain such as the Himalayas.

India has so far been using Geostationary Earth Orbit satellites mostly for imagery, and direct-to-home broadcasts. However, these systems have some limitations for two-way communications because they are operating in an orbit that is 36,000 km away from Earth. This latency can become a problem when it comes to mission-critical data services which need real-time data access. Now, players such as Elon Musk’s SpaceX and Sunil Bharti Mittal promoted OneWeb are deploying Low Earth Orbit satellites which operate at 250 km from Earth, making them conducive for providing high-capacity broadband. Such a constellation of satellites will be very useful for India given the dismal fixed broadband infrastructure. Even the mobile data network is quite erratic outside major cities. Mobile operators also have to keep upgrading their networks from 3G to 4G and now 5G. Each upgrade requires the purchase of fresh spectrum and investments into rolling out new networks. The mobile operators are under huge financial strain which has reduced the telecom market into a duopoly. In comparison, investment into a satellite network is a one-time event with minimal additional investments required.

There are at least four new players that have expressed interest in launching satellite broadband services, thus offering more options to consumers. Policymakers should ensure that the nascent satellite communication industry is not stifled by tough regulatory rules while taking the spectrum access interests of existing telecom operators into account.