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Cable ops worry as Cabinet gives nod to 700 MHz spectrum auction
MUMBAI: The Cabinet has approved the mega spectrum auction plan including the premium 700 MHz band, which multi-system operators (MSOs) say is critical for future expansion of their cable TV business.
The spectrum auction of over 2200 Mhz, which will include airwaves in the 700 MHz band for the first time, has been cleared.
The government is estimated to earn Rs 5.66 lakh crore by auctioning 700 MHz, 800 MHz, 900 MHz 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz bands.
The 700 MHz band, which has a reserve price of Rs 11,485 crore per MHz, is alone expected to fetch over Rs 4 lakh crore. Companies interested in buying a block of 5 MHz spectrum on a pan-India basis in this band will need to shell out a minimum of Rs 57,425 crore (Rs 574.25 billion).
By auctioning the 700 MHz spectrum, the government wants to boost the penetration of wireless broadband.
As reported by TelevisionPost.com, MSOs fear that their plans to provide video-on-demand services, TV channels beyond 500 and high-definition (HD), UHD and broadband services will get jeopardised with the use of 700 MHz spectrum by telcos.
Though the sale of 7oo MHz band is a worry for the MSOs, it is the 470-700 MHz spectrum which is the most precious band for the cable TV operators as most of their services depend on those frequencies. Though this band will not be up for sale in the upcoming round of spectrum auction, the fear among the MSOs and the local cable operators (LCOs) is that the government may be lured by the revenue earning potential to change its position in future.
MSOs and LCOs fear that the spectrum sale may lead to interference of signals in the coaxial pockets of their networks. They may not be hurt immediately with the current sale as they mostly do not use this band of spectrum at this stage. But they are concerned that future spectrum sales can happen at the frequencies they are currently using for their cable TV services.
The bidding is likely to take place in September. The main document of auction, the notice inviting application, is expected to be issued by 1 July. A pre-bid conference will follow soon after.
Contending that the telecom industry is already under stress, the telcos have urged the government to hold back the sale of the 700 MHz spectrum, since the ecosystem for providing services in this band is not developed and the move would lead to underutilisation of the spectrum for several years. It would also block funds of the industry.