Charge incremental SUC only on shared airwaves: Telcos to Trai

NEW DELHI: Reliance Jio, Vodafone Idea and Bharti Airtel have told the telecom regulator that the incremental spectrum usage charge (SUC) of 0.5% should for now only apply to the shared portion of the airwaves rather than the entire spectrum band which is being shared, as any additional fee acts as a deterrent for carriers to enter into sharing agreements.
Carriers however urged the authorities to look at the necessity of the SUC charge itself, given that airwaves are bought in auctions, by paying market prices. The telcos on Thursday also urged that inter-band sharing and microwave backhaul sharing must also be allowed to gain spectral efficiency for coverage, capacity, quality and speed for users.

"When you have gone to the auctioning regime, you have recovered a reasonable amount of revenue which the government intended to realise on the behest of the country. Thereafter, having a usage charge in principle is something really questionable. This is like I buy a house and still pay a rental on it," Vikram Tiwathia, deputy director general of Cellular Operators Association of India (COAI), said at a virtual open house discussion held by the Telecom Regulatory Authority of India (TRAI) on Thursday. COAI represents Bharti Airtel, Reliance Jio and Vodafone Idea.

But for now, Tiwathia said that SUC should only be applied on the shared bands.

"Any incremental revenue arising from spectrum sharing will attract licence fee and SUC anyway... So, if operators are already paying SUC for their respective spectrum holdings, an additional charge becomes a financial disincentive for them," he added.

Telcos currently pay between 3% and 5% of their adjusted gross revenue (AGR) as SUC to the DoT.