India to Allot Satellite Spectrum Administratively
India will allot spectrum for satellite broadband administratively and not via auctions. This was communicated by the Communications Minister J Adit Cindia on Tuesday. Now, this development came amid suggestions from India’s two biggest telcos for bids to be held on spectrum rights. Satellite services in India are set to grow 36% a year to reach $1.9 billion by 2030, according to various estimates. The Telecom Act of 2023, which was passed in December of last year, has very clearly put this in Schedule One, which means that for satcom, spectrum will be allocated administratively.
Cost Implications of Spectrum Allocation
Now, that does not mean that spectrum does not come without a cost. What that cost is and what the formula of that costing is going to be will not be decided by you or me; it will be decided by the ITI. Satellite spectrum across the world is allocated administratively, so India is not doing anything different from the rest of the world.
Conversely, if you do decide to auction it, then you will be doing something that is different from the rest of the world. In fact, BTI AEL Chairman Sunil Bharti Mittal had suggested that satcom providers targeting urban areas and elite retail customers should be subject to the same rules as telecom companies, including spectrum auctions. However, for providers aiming to connect remote, unserved areas, Mittal supported the administrative allocation of satellite spectrum.
Responses from Key Stakeholders
This is what AEL said: satellite operators who want to provide services to urban areas and retail customers indeed need to go through the regular licensing process of any country, and in this case, India, to obtain a license for the spectrum. They must undertake all the obligations, including security, pay the license fees and taxes, and they would be welcomed by the telecom fraternity.
Now, what adds another dimension to this situation is Elon Musk’s Starlink and Amazon, who are also aiming for the Indian satellite spectrum. The response from the minister came hours after Musk said that a move by India to auction satellite broadband spectrum and not allocate it would be unprecedented. He was reacting to a Reuters story about billionaire Mukesh Ambani lobbying for the auction route. After Musk’s criticism, the Indian government on Tuesday said that it will allot spectrum for satellite broadband administratively and not via auction.
The Ongoing Debate
Now, the debate over how to distribute spectrum for satellite services in India has been contentious since last year. Starlink and global players like Amazon support administrative allocation, while Ambani advocates for an auction process. The battle for satellite networks in India becomes interesting because it would shape the future of how we communicate, not only as individuals but also as a country.
Why is Satellite Network Important?
You might wonder why satellite networks are so important. For the uninitiated, satellite spectrum consists of radio frequencies used for satellite communications. The International Telecommunication Union, a United Nations agency, allocates these frequencies for various services. India is a member of the ITU and has signed its treaty.
Now, terrestrial networks, like the ones we use daily, are used for services like cellular networks, Wi-Fi, and landline telephones. They, of course, have faster, low latency than satellites but can only be used on the Earth’s surface. Satellite communication is used in the Internet of Things (IoT), broadcasting, weather forecasting, and remote area communication where terrestrial networks can’t be expanded. So you see, satellite networks are extremely important and crucial. In fact, the GPS, which we use on our mobile phones for location, is satellite-based.
The most important aspect, in case of a natural calamity or bad weather, is that satellite networks act as a backup. Now, after the Telecom Minister’s announcement, everyone is keenly watching Jio’s next move. This is a developing story, and as the battle for satellite rights heats up, we shall keep you posted on future developments.