India’s Department of Telecom (DoT) has decided not to increase existing spectrum caps, which could slow efforts to improve use of the country’s limited spectrum through sharing and trading.
The decision is a major setback for the country’s operators as it will limit the sharing and trading of spectrum between the two largest players in a service area, the Economic Times reported. Existing regulations limit an operator to holding 25 per cent of the spectrum in one service area and no more than 50 per cent of the airwaves in a single band (in one service area).
India’s government in August and September approved the sharing and trading of spectrum between mobile operators, a long-awaited reform that many say could kick off a wave of mergers and acquisitions in the country’s crowded mobile industry.
The reforms, which allow rivals to buy or lend unused spectrum in all bands, are expected to help operators make more efficient use of their limited spectrum resources, improve network quality as well as reduce their capex.
An internal DoT committee was concerned that higher spectrum caps could encourage larger operators to create a dominant position in a service area, the Times said. Telecom Regulatory Authority of India also recommended that the current spectrum caps should not be raised.
Government officials said the DoT’s Telecom Commission will make a final decision on the issue.