Spectrum, an auction to-be-taken report?

The department of telecom (DoT) has sought in its reference to the Telecom Regulatory Authority of India (Trai) a way to auction spectrum for satellite communications. Trai is canvassing opinion on how to go about it and receiving arguments in favour of allocating radio frequency other than through auction. The case for administrative allocation of spectrum for satellite communication is made thus. Spectrum used in this technology is shared, and arriving at a unit price could be difficult. International experience with selling radio frequencies for non-terrestrial telecom networks has been a flop. The legal position on auction as the most desirable method of allocating spectrum is not settled. Then there are additional considerations of comparing telecom services delivered through giant, intensely crowded cellular networks against satellite communication in sparsely populated areas. Satellites have the scope to provide cheaper and quicker backhaul services for 5G networks than optical fibre. Satellite and terrestrial networks are expected to complement each other, and the minute scale of the newer technology would disadvantage it if spectrum is priced competitively with cellular services.

But these arguments do not make the case compelling enough. Spectrum sales to the highest bidder remains the best route to price discovery. This process should remain technology-agnostic to encourage innovation. Policymakers will be wary of wading into the question of desirability of auctioning spectrum after the apex court upheld its allocative efficiency. Complementary technology makes this even more fraught, since terrestrial networks are making bets on satellite communication. Support to a nascent industry with strategic spinoffs should be informed by the possibility of increased concentration among terrestrial networks.

India has a new vision to commercialise space in which satellite communication has a key role. It is also making a big push in the digital economy where cellular networks are key. A special dispensation on spectrum may not be necessary to achieve both ends.