While there has been a flood of progressive measures, the sector is also greatly disturbed about the prospect of a tsunami arising due to the moves afoot to auction satellite spectrum<\/a>. Luckily, a TRAI Consultation Paper has just been issued the subject which is extremely comprehensive and informative, presenting details of international practice and floating as many as 54 questions for stakeholders to respond to. Naturally, most of the questions probe about assignment of spectrum and charging, without any pre-decided mindset.
As per this open-minded, balanced and well researched Paper, international practice and findings are overwhelmingly against the approach of auctions for allocation of satellite spectrum<\/a>. After explaining international practices, TRAI notes that “..countries like the US, Mexico and Brazil had attempted to sell frequencies (through auction) but eventually did not succeed and at last resorted to administrative licensing.” The takeaway is clear: There is no merit in ignoring international learnings as regards satellite spectrum allocation and attempting to literally reinvent the wheel.
Experts point out that the starting point of Reference dated 13.09.21 from DoT is itself debatable since it is based on a flawed premise of “in case of satellite communication, the subscriber is accessed from the satellite through ‘Access Spectrum’ similar to ‘Access Spectrum’ in terrestrial network”. This is both erroneous and also indicative of a pre-conceived orientation. Satellite spectrum is different to mobile spectrum in several key characteristics - being shared resource as compared to discrete and exclusive chunks, dependent on ITU frequency coordination, different spectrum management rules, several precious rights with only terrestrial mobile,etc). Importantly, revenue potentials of the two sectors are virtually oceans apart.
The current annual revenues of the mobile operators is of the order of Rs 2.5 lakh crores i.e. Rs. 250,000 crores whereas that of the Indian VSAT satellite operators is only about Rs. 500 crores i.e. they have only 1\/500th or 0.2% of the revenues of the telcos! As per Art. 14 of the Constitution of India and related case laws, these two unequals have to mandatorily be treated differently. It would be gross injustice to apply the same spectrum rules for the two. Moreover, Hon’ble Supreme Court held, in its advisory jurisdiction in the Presidential Reference relating to the order in the 2G case that “Auction, as a method of disposal of natural resources, cannot be declared to be a Constitutional mandate under Art. 14 of the Constitution of India.” The Supreme Court further stated that “Auction may be the best way of maximising revenue, but revenue maximisation may not always be the best way to serve public good.”
Apart from the impracticability of auctioning satellite spectrum is well-proven in international practice, there is a large number of weighty reasons – over a dozen, for not auctioning satellite spectrum. One of the most powerful of these would be the incontrovertible fact that auctioning would drastically reduce the usage efficiency of satellite spectrum and destroy value of this precious resource for catering to public interest. The fundamental objective of any spectrum management is to maximise the usage efficiency of this important resource. If any approach fails to do so, it has to be summarily rejected, especially for a country like India having a large rural and unconnected population to serve. As commonly seen in auction of terrestrial mobile spectrum, the resource is sold in frequency chunks or fragments each one being different and unique from the others. In the auction, different mobile operators bid and take differing chunks. This is the essence of the auction.
However, satellite spectrum is a completely shared resource among different satellite operators. There is no breakup or fragmentation involved. Hence, the full band used by each operator with utmost spectrum efficiency. If an auction is to be held for satellite spectrum, obviously, there would have to be a fragmentation of the concerned band to enable unique allocation to different winners. The result would only be gross inefficiency.
Such auctions also create worrying prospects of the more powerful deep-pocketed players grabbing huge portions of spectrum to act as gate-keepers to block weaker players as well as startups and reduce the competitive choice that customers need to have. We have several space startups of great promise but weak financially, could be faced with risk and investment uncertainty and get blocked by powerful ‘gatekeepers’. India simply cannot afford the risk of creating such grossly anti-competitive environment.
Satellite broadcasting and communication are powerful tools for creating public good and serving public interest. It is practically the only way to connect the unconnected and serve the underserved in rural, remote and difficult-to-reach areas. As observed by TRAI, “satellite systems can be used to provide ubiquitous coverage for providing broadband connectivity, global positioning system (GPS) and navigation, internet of things (IoT) and machine to machine (M2M) communication, remote sensing and imaging, broadcasting, disaster management, telemedicine, etc.” As quoted by TRAI from an ADB Paper, “satellite connectivity is only for remote and dispersed populations where fiber deployments are challenging”.
The new Spacecom Policy<\/a> is aimed at catalysing Private Sector participation in the Space sector and raising India’s share in the global space economy from less than 2% to 10% soonest. However, satellite spectrum auctions would inexorably push back the emerging space sector which holds enormous promise for Digital India<\/a>.
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