The Telecom Regulatory Authority of India (TRAI) is facing problems in finalizing ways to auction spectrum for satellite broadband services, and is saying that an auction process in fact may not be workable.
As per a report by the Economic Times, TRAI is struggling to fix the unit to use for satellite spectrum auctions because satellite spectrum is different from mobile spectrum. Consequently, TRAI says that selling it on a per MHz basis may not be a feasible option.
The Department of Telecommunications (DoT) – which made the decision earlier that new satellite spectrum would be awarded via auction, and left it to TRAI to figure out how to make it work – has suggested different models to sell satellite spectrum to the highest bidder.
For example, the DoT has proposed that the auction could be based on satellite constellations, as there are different kinds of spectrum used in satellite services, including gateways and the actual connections to users.
The DoT has previously suggested that the satellite spectrum could be awarded on an angular basis in latitude and longitude. It also suggested that gateways be set up in sparsely populated areas and pricing can be set on a pan-India basis, assuming three gateways per city.
“With that calculation, there could be around 2,000 gateways across the country and pricing can be given accordingly,” the publication reported.
TRAI consultation paper in the works
A government official told ET that TRAI will need to specify the reasons auctioning spectrum for satellite broadband is not feasible if that is its conclusion. In anticipation of such a situation, TRAI is now planning to issue a consultation paper on the modalities around auction of satellite spectrum.
“The regulator is working on the issue, and we expect the satellite consultation paper by the end of this month or by early April. We firmly believe that price needs to be discovered by market forces and that can only happen by auction model,” a DoT official was quoted as saying by the publication.
The report further added that the DoT would seek clarification from the Supreme Court if TRAI doesn’t recommend auctions. It will also ask the court if spectrum can be allocated administratively.
To auction or not to auction
Various players are gearing up to deliver satellite-based broadband services in India, including Bharti-backed OneWeb and Elon Musk’s Starlink. Tata-owned Nelco is partnering with Canadian company Telesat to offer satellite broadband, while Reliance Jio has formed a JV with Luxembourg-based SES.
Despite the DoT’s decision, players are split on how spectrum for such services should be allocated.
Jio has pushed in favor of auctions for satellite spectrum, saying that India must take a lead in “spectrum and satellite transformation”.
However, Bharti Enterprises chairman Sunil Mittal insists that spectrum for satellite services can’t be auctioned like 5G because such spectrum is shared and required only in limited areas.
There’s also the cost issue – India’s mobile spectrum auctions have been notoriously overpriced, and Mittal has pointed out satellite broadband services are not going to make the billions of dollars in revenue that mobile services do.