Will this chaos lead to some good?

It has been a long time since I have been here. However, quite like India, the telecom scene in India also is a case of change, but yet no change.

We are currently in the midst of a proposed New Telecom Policy. That it was supposed to come in 2011 is a different issue. The action started after the Supreme Court cancelled 122 licences issued to eight operators in 2008. It wanted the government to auction all spectrum in future. With the SC getting into the act (everything needs a push from the SC)the Department of Telecommunications, the Communications ministry and the Telecom Regulatory Authority of India (TRAI) are looking to clean up the mess.

Isn't that expecting too much.

Well, this time round, TRAI managed to spook it further. First it recommends a reserve price of Rs 3,622 crore per MHz for 1800 MHz band spectrum. That's a reserve price of Rs 18,100 crore for 5MHz of spectrum. Two, it ensures that only one block of 5MHz is up for auction, despite the fact that the SC had cancelled licences of eight operators. Third, it ensures that there will be spectrum re-farming in the 900 MHz band.However, it suggested that operators need to pay only a quarter of the discovered price in the auction immediately. However, that is unlikely to pass muster with the DoT and the empowered Group of Ministers.

What it has done is make almost all operators are unhappy. The new ones hate it because there is only one band in each circle at a huge price. Of the eight operators whose licences were cancelled, at least three have exited. Two are incumbents. So that leaves three new operators--Uninor, Sistema Shyam and Videocon Telecommunications in the fray. The original incumbents find the new reserve price for both 1800 MHz and 900 MHz band too high. The operators who came in between need to re-farm their 800 MHz band.

But is everything all that dark? Not really. DoT is speaking to the defence ministry to vacate spectrum so that at  least three licences can be given in each circle.

So, is this the beginning of a new dawn? Maybe, since the SC has brought in the first wave of consolidation. The next few months should see more action.

Stay tuned. I am back to keep you updated on the go.