oppn parties Spectrum Pooling: Sunil Mittal is Right

News Snippets

  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
  • India has moved to the 40th spot in the innovation index, up 6 spots from last year
  • DGGI has alleged that top insurance companies, banks and NBFCs has committed a fraud of Rs 800cr by claiming input tax credit without underlying supplies
  • The Centre will borrow Rs 10000cr less than planned earlier due to good revenue collections
  • At $23.9bn, India's current account deficit widened to 2.8% in Q1, the worst in four years
  • Stocks continue to flounder on Thursday: Sensex sheds 188 points to 56409 and Nifty 40 points to 16818
  • The 36th National Games were declared open on Thusrday by PM Modi in front of a record crowd in Motera near Ahmedabad
  • Jasprit Bumrah most likely to miss T20 World Cup due to recurrence of back injury
  • PFI's political wing, the SDPI is on EC radar and action will follow soon if discrepancies are detected
  • Ashok Gehlot to meet Sonia Gandhi today, says all issues will be sorted out soon
  • Referring to the PFI ban, most Muslim organizations ask the government to take similar action against right wings organizations like the RSS, Bajrang Dal, VHP and the like
In a landmark order, Supreme Court rules that all women, married or unmarried, are entitled to safe and legal abortion up to 24 weeks of pregnancy as per the MTP Act
oppn parties
Spectrum Pooling: Sunil Mittal is Right

By Sunil Garodia
First publised on 2017-03-03 18:51:04

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.
Is Sunil Mittal right in asking telcos to pool spectrum? Given his dominant position in the market, will other players listen to him? These are the questions that arise after Mittal made a very sane proposal for all telecom companies to pool spectrum to ensure cost benefit to all and optimize the usage. Mittal’s suggestion assumes importance because of three things: first, spectrum is a scarce commodity as the government releases it in small tranches, with the major part remaining with the Army; second, it is very expensive and third, it’s usage is very lopsided.

In India, it is seen that cut-throat competition during spectrum auctions makes the telcos acquire it at fancy prices. Later, most of these companies cannot make efficient use for want of customers. They have idle capacity. Hence, one company might suffer network congestions and call drops as it has lesser spectrum than its subscriber base demands while another earns nothing from the bandwith that lies idle. This benefits none and needs to be rectified. Pooling of spectrum is the best solution.

Mittal has suggested the formation of a new company, jointly owned by all telcos. Each company will then release the spectrum held by them to this new company. Later, each company will pay the new company for only the amount of spectrum they use. Hence, if a company has idle spectrum and another company uses it from the common pool, it will start earning from it till such time its own usage increases. As of now, there is no justification for telcos to block the scarce and expensive resource without putting it to use. It also does not make business sense.

In a hard hitting editorial, The Economic Times has asked telcos to shed their outdated business policies to look into the modalities of pooling spectrum as suggested by Mittal. It has opined that with technology throwing up newer and better uses of bandwith companies should not become spectrum-squatters and suggested that like licensing, business conduct should also become technology-agnostic.

But business in India is conducted in a very jealous manner. The guiding principle is “if I cannot earn, I will not let others earn too.” Mittal’s suggestion might not find many takers as he is the dominant player in the market. People will view his suggestion, however sane, with large dollops of suspicion. They will say that Mittal is suggesting this as he needs it for his company. In thinking so, they will forget that Mittal is not asking anything for free or at a price lower than what it commands. They will also forget that he is suggesting opening a door which will allow many companies to earn from their idle capacity. If pooling is rejected, it would be a tragedy. For, it is the best way forward for the market. India’s drive towards digitization depends on better telecommunication and internet services and anything that frees up unutilized spectrum will be of great help. Hence pooling should be done sooner rather than later.