Operators Reliance Communication (RCom) and Reliance Jio today finalised a spectrum sharing and trading alliance that will see RCom sell 800MHz spectrum in nine regions to Jio and both share bandwidth in the same band in 17 service areas.
As part of the agreement, the two companies also plan to enable roaming between their networks within service areas, the Economic Times reported. They already have long-term deals to share tower and fibre assets nationwide.
Competition in the country’s 4G market has intensified with the pending entry of Jio, which is the only operator to own 4G spectrum across India. After multiple delays last year, Jio recently said it will officially launch 4G service by early March.
The two firms, owned by brothers Mukesh and Anil Ambani, announced spectrum sharing and trading deals in August and September. They 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. It applied to the DoT to liberalise its holdings in the 800MHz band in 20 service regions. The spectrum was originally given without auctions at government-set prices.
A week ago India’s Department of Telecom (DoT) asked RCom to pay almost INR70 billion ($1.05 billion) to ‘liberalise’ spectrum in 16 regions.
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 operator has 30 days to pay the demand note.
Last Thursday the Kolkata High Court ruled that RCom didn’t have to make a bank guarantee for the one-time spectrum charge.
The matter of whether the one-time charge is legal is pending in various courts, the Times said.