The Department of Telecommunications (DoT) is expected to seek legal advice on the distribution of spectrum to corporations for the deployment of private captive networks
Officials aware of the details said the DoT will ask if the spectrum can be given administratively or through auction. While the Cabinet had approved direct allocation to enterprises in June 2022, it had not spelled out the specifics of the methodology.
According to officials with knowledge of the facts, the Department of Transportation will inquire whether spectrum may be distributed administratively or by auction. While the Cabinet authorized direct allocation to firms in June 2022, it did not specify the process. “We will seek clarification from the Ministry of Justice. According to the Supreme Court’s 2012 decision, auctions are the preferred method of providing spectrum for commercial purposes. Though private networks are not permitted to provide commercial telecom services, we must ensure that we do not violate the Supreme Court’s judgment “ET was informed by an official.
The topic of direct spectrum allotment to corporations has been controversial, pitting technology companies against telecom carriers.
Telcos have argued that direct allocation will disrupt the fair playing field and offer technology providers a backdoor entry into providing 5G services to corporations. Tech corporations seek government spectrum directly for building up captive networks, arguing that enterprises should not be reliant on telecoms.
According to the DoT’s preliminary rules on private networks, firms who wish to build up their captive networks can lease spectrum from telecom providers or obtain it directly from the DoT. They might even request that telecom companies deploy their networks.
The DoT looks to be adopting a careful approach in this subject, pitting Reliance Jio and Bharti Airtel against the Tata Group. another source informed that The issue might worsen if it later emerges that private networks gained financially from having spectrum given administratively rather than through auction.
Companies like Infosys, GMR, Larsen & Toubro, Tata Power, and Tata Communications have previously appealed to the DoT for direct allotment of the spectrum, including in the mid-band (3,300-3,670 MHz), for private networks. These applications were submitted in response to a DoT experiment designed to assess the demand for spectrum to establish private networks.
“Because spectrum for private networks will be required in a specific location, auctioning it off for exclusive use is both absurd and inefficient. We have associated auction with openness, but it is merely one technique of achieving transparency, “Mahesh Uppal, director of telecom consultant Com First (India) Pvt Ltd, agreed. “Furthermore, the Supreme Court later stressed that auctions are not a fundamental concept and may not be suitable in all cases.” officials of DOT
The telecom sector has stated to the government that permitting direct spectrum allocation to corporations would harm the telecom industry’s financial health. Telcos expect enterprise services to account for 30-40% of the industry’s 5G income, citing their ability to set up captive private networks on their own. As a result, distributing spectrum directly to corporations may harm the industry’s earnings from next-generation technological offerings. Following the Supreme Court’s rulings in 2012, which designated auction as the means for distributing limited natural resources, mobile operators had also stated that directly assigning spectrum would be legally impossible.