POLICY: For a Slice of the Cake

Indian telecom is preparing for an other big fight, similar to WLL (M) vs
cellular a few years ago. But this time, the fight is not about the legality of
services, but about spectrum allocation. The ball was set in motion with TRAI
floating a consultation paper-Spectrum Related Issues: Efficient Utilization,
Spectrum Allocation, and Spectrum Pricing-on 31 May 2004. Being a hot issue,
TRAI received an overwhelming response and around 43 organizations submitted
their comments. Never had TRAI received such an overwhelming response as was
seen on the spectrum issue. A lot is at stake. Of these, industry associations
(Indian as well as foreign) contributed 15, Indian companies submitted around
10, MNCs filed seven, and the remaining 11 came from consultants and academic
institutions.

While TRAI struggles to prepare the spectrum recommendations, the GSM service
providers like BSNL, Bharti, Hutch, and the others have already applied for 3G
spectrum. Presently, the Department of Telecommunications and its concerned
divisions are studying the matter and preparing specifications for the rollout
of 3G services in the country. On the other hand, TRAI will have to look into
the selection method, fix the number of operators, decide on the license fees,
design the revenue share percentages, and also look at spectrum allocation. So
that India can also board the 3G bandwagon in the next couple of years and is at
par with the other countries.

All this makes the spectrum consultation paper all the more important as it
is going to lay the platform from which 3G services will take off in the future.
With stakes from both the camps (CDMA as well as GSM) being high, nobody is
ready to budge even an inch for the other party. It is not easy for the
authorities to finalize the spectrum utilization, allocation, and pricing
knowing the fact that TRAI is yet to appoint a consultant for the issue of
spectrum; a subject not easy to handle even with the best of brains as the
matter is highly technical. TRAI should have roped in wireless advisers to get
insight into the matter and handle the issue in a more professional way.

Recently, TRAI conducted the first open house on spectrum in Bangalore on 20
August 2004. It plans to conduct such open houses in other cities soon. Before
finalizing the spectrum issue, the regulator should stress on standards
policies, bandwidth availability, and spectral efficiency.

Stick to Standard Policies

While allocating spectrum, TRAI should focus on National Frequency
Allocation Plan 2002 and ITU norms. If any change is recommended, it should be
as per both the plans so that there can be harmonization of services not only
within India, but also with other countries.

The authority has to carefully look into spectrum allocation within the
specified band for both CDMA as well as GSM service providers and should not
deviate from it . Any deviation can lead to lot of complications.

Both these policies have been formulated with a general consensus and have
taken everybody's viewpoints in to account, before finalizing the specs of the
final document. For example, the IMT 2000 is considered to be the largest
project that the world telecommunications body has ever had on its agenda. It
was discussed for many years before being finalized. The core band was finalized
as the result of a consensus process, which included radio experts and
deliberations on technologies implemented all over the world.

Similar is the case with the National Frequency Allocation Plan 2002. If some
frequency band is occupied by other agencies, effort should be made to clear
those bands at the earliest by allocating different frequency bands to the
concerned parties. The cost of transition should be recovered from the spectrum
license fees so that the other party can be compensated. The damage would be
irreparable, if the authorities change IMT 2000 bands for different services
thereby restricting roaming and disturbing economies of scale.

Spectrum Availability

Service providers should get large spectrum bands rather than small chunks
in different bands. This helps service provider in rolling out the network with
an eye on future technologies and services. This also helps service providers in
doing better network planning. Apart from this, it also helps in catering to the
growth in demand at a lesser cost.

The authority should make it mandatory and prescribe timeframes and norms for
frequency assignments to service providers, as this will help in faster
deployment of services in new areas and will also help in improving the QoS
norms. All this will also result in more revenues for the government.

Higher Spectral Efficiency

Spectral efficiency is considered to be a key measure for the effectiveness
of mobile technologies, and rival camps will always claim to be more efficient.
With mobile technologies gaining acceptance, there is always a big demand for
huge amounts of spectrum from service providers, which is never satisfied. So
vendors come into play for increasing network efficiency, resulting in further
increase in cost.

Another bone of contention is that service providers are allocated spectrum
city wise, but revenue share is collected circle wise. So, the authorities
should look into this anomaly and rectify it such that one can achieve higher
spectral efficiency. One way to do this would be to define charges for smaller
blocks based on the number of users in an area. This would enable channeling
more spectrum where the demand is higher rather than keeping it idle in areas
where there are less subscribers.

For different frequency bands, the authorities should look at different
subscriber numbers rather than looking at one subscriber number for all
frequency bands. This would result in higher efficiency: as lower the frequency,
greater is the coverage.

Another way of increasing efficiency and reducing interference would be to
provide contiguous frequency bands. This would minimize the requirement of guard
bands between channels when they are used in a single network.

Spectrum is a delicate issue and the authorities should take extra precaution
so that everyone including policy makers, the government, service providers, and
users benefits.

Pravin Prashant and Anurag
Prasad