The Telecom Commission, the highest decision making body of the Telecom Department, in its meeting held on 26th December 2011 considered the TRAI's recommendations and took the following decisions on those recommendations:
a) A one time fee will be levied on the telecom companies for the 2G spectrum held by them beyond 6.2 MHz.(The TRAI recommended for payment of Rs 4571 crores on each MHz spectrum beyond 6.2 MHz, on a pro-rata basis. It is estimated that the telecom operators have to pay more than Rs 17500 crores for this, to the Government. )
b) Mergers and Acquisitions will get automatic clearance if the combined market share of the entity is not more than 35% and spectrum held is not more than 25%. When the market share of the combined entity is more than 35% and less than 60%, the TRAI will examine the case and will give its recommendation to avoid "monopoly".
c) The License Fee was fixed as annual revenue share of 8% against the existing 6% to 10% share depending on the service/region and this will be implemented in two phases over two years.
d) The telecom tower companies and internet service providers who are not paying annual license fee till now, have to pay this 8% on their revenue as license fee hereafter.
Other decisions pertaining to telecom sector will be finalized by the Telecom Commission within a week.
The Telecom Commission will send all these decisions to the Minister for C&IT Kapil Sibal and subsequently will be sent for the approval of the Cabinet.
But, as I detailed in my blog entry dated 22-12-2011, the merger of AT&T having 27% of the market share with T-Mobile having 17% market share was not allowed in USA since the 44% market share of the combined entity would result in monopoly. In such case why the Telecom Commission is supporting the recommendation of the TRAI allowing 35% market share for the combined entity automatically and upto 60% with the recommendation of the TRAI? At present Airtel is having 23% of the market share, Vodafone is having 19% of the market share and they are making agreements like intra circle roaming agreements although such agreements are illegal, to dominate the market. In such case, allowing market share upto 35% automatically and upto 60% with the recommendation of TRAI is nothing but encouraging monopoly which is against the interest of the customers. The Minister and the Cabinet should not allow this.
a) A one time fee will be levied on the telecom companies for the 2G spectrum held by them beyond 6.2 MHz.(The TRAI recommended for payment of Rs 4571 crores on each MHz spectrum beyond 6.2 MHz, on a pro-rata basis. It is estimated that the telecom operators have to pay more than Rs 17500 crores for this, to the Government. )
b) Mergers and Acquisitions will get automatic clearance if the combined market share of the entity is not more than 35% and spectrum held is not more than 25%. When the market share of the combined entity is more than 35% and less than 60%, the TRAI will examine the case and will give its recommendation to avoid "monopoly".
c) The License Fee was fixed as annual revenue share of 8% against the existing 6% to 10% share depending on the service/region and this will be implemented in two phases over two years.
d) The telecom tower companies and internet service providers who are not paying annual license fee till now, have to pay this 8% on their revenue as license fee hereafter.
Other decisions pertaining to telecom sector will be finalized by the Telecom Commission within a week.
The Telecom Commission will send all these decisions to the Minister for C&IT Kapil Sibal and subsequently will be sent for the approval of the Cabinet.
But, as I detailed in my blog entry dated 22-12-2011, the merger of AT&T having 27% of the market share with T-Mobile having 17% market share was not allowed in USA since the 44% market share of the combined entity would result in monopoly. In such case why the Telecom Commission is supporting the recommendation of the TRAI allowing 35% market share for the combined entity automatically and upto 60% with the recommendation of the TRAI? At present Airtel is having 23% of the market share, Vodafone is having 19% of the market share and they are making agreements like intra circle roaming agreements although such agreements are illegal, to dominate the market. In such case, allowing market share upto 35% automatically and upto 60% with the recommendation of TRAI is nothing but encouraging monopoly which is against the interest of the customers. The Minister and the Cabinet should not allow this.
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