New Delhi | Mumbai: India's telecom regulator Friday recommended the administrative allocation of satcom spectrum for a fee pegged at 4% of adjusted gross revenue (AGR) to be assigned for five years. The long-awaited recommendations will now be vetted by the telecom department's highest decision-making body, the Digital Communications Commission. It will then be taken up by the Cabinet for ratification, paving the way for the commercial rollout of next-generation satellite internet services in the world's second-largest telecom market.
Companies in the fray include Elon Musk-owned Starlink, Jeff Bezos-owned Amazon Kuiper, Bharti Group-backed Eutelsat OneWeb and Reliance Jio-SES, Globalstar, among others.
The Telecom Regulatory Authority of India (Trai) has proposed that both geostationary (GSO) and non-geostationary (NGSO) satellite operators will be required to pay 4% of their AGR, with a minimum annual charge of ₹3,500 per MHz spectrum block. Satcom companies offering services in urban areas would have to shell out ₹500 per subscriber annually, but nothing for rural users. They will have to pay an 8% licence fee for offering commercial services, Trai chairman AK Lahoti said at a press briefing.
Satcom Can Only be Complementary: Lahoti
However, there won't be any upfront charge or allocation price for satellite spectrum, said Lahoti.
Trai suggested that the Ku, Ka, Q/V, L, S, and C bands can be assigned for five years, extendable by another two years, as the business potential of the new technology emerges in the near term.
The regulator has backed the methodology suggested by satcom companies during the consultation process, but experts said the price may be higher than what Starlink and Amazon had expected.
Telcos such as Airtel, Jio and Vodafone Idea had pushed for the spectrum to be auctioned, warning that administrative allocation could allow satcom companies to offer similar services using cheaper airwaves, which wouldn't be a level playing field.
Lahoti rejected the argument, stating that Trai had found that the two technologies were different and that satellites could only be complementary.
"It's not factually correct that satcom services are competing with terrestrial services because there is a huge difference between the capacity of the terrestrial network and the satellite network," he said.
The regulator also rejected the argument that satcom firms will bypass rural areas for urban ones as this is not technically feasible.
"The entire capacity of one region can't be shifted to another," he said. "If they (satcom) firms do not offer services in rural areas, the capacity will (be unutilised) but it can't be shifted to urban areas."
The recommendations come after eight months of consultations. The period was marked by a battle between India's telcos and satcom companies over the methodology and pricing of satellite spectrum and then surprise rapprochement in the last few months, culminating in telcos Reliance Jio and Bharti Airtel entering marketing pacts with Starlink.
The Centre had held consistently to the view that satcom spectrum shouldn't be auctioned. At stake is India's growing space economy, which is reckoned to have a potential to touch $44 billion by 2033, boosting its global share to 8% from 2% currently, as per space regulator IN-SPACe.
The Trai recommendations come a day after Starlink received a letter of intent (LoI) from the Department of Telecommunications (DoT) for a satcom licence.
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The Telecom Regulatory Authority of India (Trai) has proposed that both geostationary (GSO) and non-geostationary (NGSO) satellite operators will be required to pay 4% of their AGR, with a minimum annual charge of ₹3,500 per MHz spectrum block. Satcom companies offering services in urban areas would have to shell out ₹500 per subscriber annually, but nothing for rural users. They will have to pay an 8% licence fee for offering commercial services, Trai chairman AK Lahoti said at a press briefing.
Satcom Can Only be Complementary: Lahoti
However, there won't be any upfront charge or allocation price for satellite spectrum, said Lahoti.
Trai suggested that the Ku, Ka, Q/V, L, S, and C bands can be assigned for five years, extendable by another two years, as the business potential of the new technology emerges in the near term.
The regulator has backed the methodology suggested by satcom companies during the consultation process, but experts said the price may be higher than what Starlink and Amazon had expected.
Telcos such as Airtel, Jio and Vodafone Idea had pushed for the spectrum to be auctioned, warning that administrative allocation could allow satcom companies to offer similar services using cheaper airwaves, which wouldn't be a level playing field.
Lahoti rejected the argument, stating that Trai had found that the two technologies were different and that satellites could only be complementary.
"It's not factually correct that satcom services are competing with terrestrial services because there is a huge difference between the capacity of the terrestrial network and the satellite network," he said.
The regulator also rejected the argument that satcom firms will bypass rural areas for urban ones as this is not technically feasible.
"The entire capacity of one region can't be shifted to another," he said. "If they (satcom) firms do not offer services in rural areas, the capacity will (be unutilised) but it can't be shifted to urban areas."
The recommendations come after eight months of consultations. The period was marked by a battle between India's telcos and satcom companies over the methodology and pricing of satellite spectrum and then surprise rapprochement in the last few months, culminating in telcos Reliance Jio and Bharti Airtel entering marketing pacts with Starlink.
The Centre had held consistently to the view that satcom spectrum shouldn't be auctioned. At stake is India's growing space economy, which is reckoned to have a potential to touch $44 billion by 2033, boosting its global share to 8% from 2% currently, as per space regulator IN-SPACe.
The Trai recommendations come a day after Starlink received a letter of intent (LoI) from the Department of Telecommunications (DoT) for a satcom licence.
