More Questions about DoT's 3G/BWA Policy

The DoT memorandum regarding 3G and BWA spectrum is fairly detailed and has a lot of useful information. A careful reading reveals some interesting points. A total of 80 MHz of BWA spectrum is available in 2.3 and 2.5 GHz bands, of which 20 MHz has already been given to the state-owned operators MTNL and BSNL in their (mutually exclusive) respective areas of operation. In the 2.3 GHz band, all the circles have 2 contiguous blocks of 20 MHz each but their location within this band is not the same across all circles. In the 2.5 GHz band, most circles again have 2 contiguous blocks of 20 MHz each but in 3 circles (Maharashtra, Gujarat and AP), paired spectrum is being offered in the form of two 10 MHz blocks with 100 MHz separation between them. What's even more interesting that the same 20 MHz contiguous block (2535-2555 MHz) that is being offered for BWA in most circles is split into two 10 MHz bands (2535-2545 MHz and 2545-2645 MHz) and paired with 10 MHz blocks in the 2645-2655 MHz range in the three circles mentioned above.

This clearly has implications for both impending deployments as well as any future auctions in the 2.5 GHz band. In particular, BSNL wants to use the paired 2x10 MHz spectrum in FDD mode. It means that another operator who gets BWA spectrum in the 2.5 GHz band in any Gujarat/Maharashtra/AP will either have to use FDD as well or risk a high degree of interference in case it uses the spectrum in TDD mode. Quite expectedly, objections are already being raised.

Another cause for confusion is the policy regarding new 3G operators. DoT is allowing entities that currently do not have a UAS license to bid for 3G spectrum and the license will be awarded to them, in case they are successful in the auction. In the past, UAS licensees have been considered automatically entitled to 4.4 Mhz of GSM spectrum (or 2.5 MHz of CDMA spectrum). It's not clear whether the same rule will be followed in this case. TRAI has asked for more clarity regarding this.

DoT Amends 3G and BWA Policy

In the wake of the debate triggered between various stakeholders (and Govt depts) after DoT announced the long-awaited 3G and BWA sepctrum policy, a number of changes have been announced.

With regards to 3G, the eligibility criteria has been strengthened by stipulating that a non-UASL entity aiming to bid for spectrum must have prior experience in running 3G services. Spectrum for EVDO will also be allocated via auctions thus reversing the earlier position of giving spectrum to CDMA operators based on subscriber criteria. The reserve price for 2x1.25 MHz in 800 MHz band has been set at 25% of the 3G reserve price (following the pro-rata calculation). Finally, the annual spectrum fee will not be calculated on the incremental revenue earner from 3G services. This is going to be a tricky one, separating revenue earned from 2G and 3G services. The formula for determining the incremental revenue will be specified later.

As for BWA services, CMTS licence holders are now also eligible to bid for spectrum. The spectrum in 2.3 and 2.5 GHz band will be allocated for TDD mode only. The reserve price has now been doubled, such that it becomes 50% of the 3G base price (for a paired 2x5 MHz block). The roll-out conditions have also been changed. Now, 90% of a metro service area must be covered within 5 years and 50% of rural SDCAs must be covered in Category A, B and C areas during the same period.

The full set of amendments are available on the DoT website.