India’s Telecom Operators Raise Concerns Over Satellite Spectrum Pricing
India’s telecom landscape is being shaped by concerns from top operators, specifically Reliance Jio and Bharti Airtel, regarding the proposed pricing for satellite spectrum. The duo warns that undervaluation could adversely affect their business models and give an edge to satellite internet providers, including Elon Musk’s Starlink.
Concerns from the Cellular Operators Association of India
As reported by Reuters, the Cellular Operators Association of India (COAI), representing major telecom stakeholders, reached out to the telecom ministry on May 29. They called for a reassessment of the existing proposals, highlighting that traditional telecom players incur far greater costs for spectrum acquisition, primarily through competitive auctions, unlike the suggested lower administrative fees for satellite firms.
The Indian telecom regulator has recommended that satellite companies contribute 4% of their annual earnings to the government. Starlink is said to be in favour of this model, which mirrors a global trend that sees spectrum as a shared natural resource rather than something that should be auctioned.
A segment from the COAI letter, as quoted by Reuters, stated that “Price per MHz should be equivalent or at least comparable for both, especially when used to reach the same consumers for identical services.” The association has also pointed out that satellite internet could emerge as a viable and cost-effective alternative to traditional broadband services.
Reaction from Reliance Jio and Bharti Airtel
Neither Reliance Jio nor Airtel has responded to inquiries from Reuters, and Starlink did not provide immediate comments on the matter.
Government Response to Industry Concerns
A senior government official indicated to Reuters that the telecom ministry is in the process of reviewing feedback from regulators. They acknowledged that this type of industry feedback is not unusual.
Insiders familiar with the situation have noted that companies like Reliance Jio are particularly apprehensive about the potential financial disparities, as they continue to invest significantly in comparable broadband initiatives while facing steep costs.
Significant Investments in 5G Spectrum
Reliance and other operators have reportedly invested nearly $20 billion (around ₹1.72 lakh crore) in recent years for the acquisition of 5G spectrum through auctions.
Distribution Deals with Starlink
Despite their reservations, both Reliance and Airtel entered into distribution agreements earlier this year to market Starlink equipment, all while gearing up to compete with the service once it is accessible to consumers.
Telecom minister Jyotiraditya Scindia mentioned to The Print that the procedure for Starlink to secure its operating licence in India is “nearly complete.”