In what’s going to come as a aid for telecom corporations, the Department of Telecommunications (DoT) has stated that no spectrum utilization cost (SUC) might be charged for spectrum acquired by means of auctions held after September 15, 2021. The order comes days after the nation took its first step in direction of 5G rollout because the Union Cabinet cleared a proposal to ask purposes for spectrum auctions.
“For spectrum acquired through auctions held after 15.09.2021 in different access spectrum bands, no SUC shall be charged,” a notification by the DoT stated, including, “The weighted average is to be derived by the sum of the product of spectrum holdings and applicable SUC rate, divided by (a telco’s) total spectrum holding.”
SUC is calculated by means of a median weighted formulation for telecom corporations (telcos) who’ve a mixture of administratively allotted spectrum and spectrum acquired by means of auctions.
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Since telcos like Airtel and Vi have a mixture of each sorts of spectrum whereas Jio has all its spectrum by means of auctions, in 2016, the Centre mounted the SUC flooring fee at 3 per cent of a telco’s adjusted gross income (AGR).
The DoT’s newest order doesn’t point out the SUC flooring fee, which, in response to business executives, means that the requirement has been eliminated in an effort to facilitate the upcoming spectrum auctions.
The DoT’s order addresses a protracted standing demand by the business to have the ground fee scrapped. Telecom operators have welcomed the choice.
“We welcome and thank the Government & Minister of Communications for the much-awaited DoT order regarding the levy of SUC charges for spectrum in 600 MHz, 700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 2,500 MHz, 3,300 MHz and 26 GHz bands. The order will provide clarity to telecom service providers for the upcoming auctions,” stated S P Kochhar, director basic of telecom business physique Cellular Operators Association of India (COAI), which counts all of the three main telcos — Airtel, Jio and Vi — as members.
Last week, the Union Cabinet cleared a proposal to public sale over 72,000 megahertz (MHz), or 72 GHz, of airwaves with a validity interval of 20 years. The public sale might be held for spectrum within the frequencies of 600 MHz, 700 MHz, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 3,300 MHz and 26 GHz bands. At reserve worth, the whole thing of the spectrum is valued at over Rs 5 lakh crore.
Last 12 months, the Centre had introduced a telecom sector aid bundle, and a few aspects of the scheme have been included within the phrases of this public sale. A compulsory requirement to make upfront fee by the profitable bidders has been completed away with. Payments for spectrum could be made in 20 equal annual instalments to be paid prematurely at first of every 12 months. Bidders can be given an choice to give up the spectrum after 10 years with no future liabilities with respect to stability instalments.