India’s Department of Telecom (DoT) has asked Reliance Communications (RCom) to pay almost INR70 billion ($1.05 billion) to ‘liberalise’ spectrum in 16 regions in order to share and trade the airwaves.
After reaching spectrum sharing and trading deals with 4G upstart Reliance Jio in August and September, RCom applied to the DoT to liberalise its holdings in the 850MHz band in 20 service regions. The spectrum was originally given without auctions at government-set prices.
The two operators were the first in India to take advantage of new regulations allowing spectrum sharing. The government’s new spectrum regulations do not allow the sharing of non-auctioned spectrum, so RCom needs to pay a market-linked price to the government for the spectrum.
The DoT valued the market price of the spectrum in 16 regions (the market price wasn’t available in the other four) at INR53.8 billion and added a one-time spectrum usage charge of INR16 billion, the Economic Times reported. The operator has 30 days to pay the demand note.
In last year’s auctions RCom was only able to hold onto its 900MHz spectrum in two of the seven regions where its licences were expiring. The company, however, was able to compensate for the shortfall as it purchased 26.5MHz in the 800MHz band (only 5MHz was expiring). It now has 800MHz and 1.8GHz holdings in the five regions where it will lose 900MHz spectrum.