Telecom minister makes it clear: Spectrum for satcom will be allocated administratively, but not 'free'

Telecom Minister Jyotiraditya Scindia on October 15 clarified the government’s stand on the satcom spectrum issue. He said that spectrum will not be auctioned and allocated administratively but service providers have to pay a cost.

“The Telecom Act 2023 which was passed in December of last year has very clearly put this in Schedule 1 which means that satcom spectrum will be allocated administratively,” Scindia said at India Mobile Congress while responding to a question at a media briefing.

According to a report by news agency PTI, Scindia, however, he made it clear that radiowaves will come with a cost even if assigned without auction for satellite-based communications services.

“That does not mean that spectrum comes without a cost. What that cost is and what the formula of that cost is going to be will not be decided by you and me but it will be decided by Trai,” he added.

“We have a regulatory authority for telecom and that regulatory authority has been empowered by the constitution to determine what that administrative pricing is going to be? I am very confident that they will come up with the best pricing that should be adopted provided that it is being given in an administrative manner,” Scindia added.

The development essentially means that the demand of Reliance Jio , Bharti Airtel and service providers to auction satcom spectrum has been rejected. Scindia’s comments come hours after Bharti Airtel founder and chairman Sunil Bharti Mittal joined rival Reliance Jio in seeking allocation of spectrum for satcom services in the same manner as it is allocated to telecom players.

What concerns do Jio and Airtel have
Both the telecom giants have sought a fair and transparent auction system for satellite services to ensure level competition.

Reliance Jio has called for a revised approach to spectrum allocation for satellite communication companies in India. In a letter dated October 10 to Telecom Minister Jyotiraditya Scindia, Jio urged a reconsideration of the current proposal, citing concerns about fair competition with established telecom operators.

Elon Musk's Starlink , Amazon's Kupier, Bharti Group-backed OneWeb Eutelsat, and SES-Jio joint venture have expressed interest to provide their services in India, which will directly compete with land based mobile networks.

Jio emphasised that satellite companies like Starlink and Amazon's Kuiper should acquire spectrum through a transparent auction process, similar to traditional telecom players – pay licensing fees, mirroring the obligations of existing telecom providers.

Sunil Mittal, chairman of Bharti Airtel, echoed this sentiment at the India Mobile Congress, stating that satellite companies offering services in urban areas should participate in spectrum auctions. Airtel also reiterated its stand and shared a letter it wrote to the telecom department in March.

Musk calls auction “unprecedented”
On October 14, Musk reacted to Reliance Jio’s reported move to urge the government for transparent auction for satellite spectrum.

“That would be unprecedented, as this spectrum was long designated by the ITU [International Telecommunication Union] as [a] shared spectrum for satellites,” Musk said.

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That would be unprecedented, as this spectrum was long designated by the ITU as shared spectrum for satellites.

— Elon Musk (@elonmusk) October 14, 2024

Scindia spoke on similar lines that satellite spectrum across the world is allocated administratively.

“India is not doing anything different from the rest of the world. Conversely, if you do decide to auction then you are doing something which is different from the rest of the world,” he said

“Satellite spectrum is a very high level of spectrum beyond 7-8 Ghz is shared spectrum. If spectrum is shared then how can you price it individually? I think there are a number of issues that go into decision making which is why globally all countries of the world are following a certain model and India is doing pretty much the same,” the minister added.