Telecom Spectrum Auction

Telecom Spectrum Auction

Subject: Science & tech

Section: IT

Context- Why are telecom companies upset with the regulator despite its proposal to cut prices by 40%?

Concept-

The story so far:

• The Telecom Regulatory Authority of India (TRAI) this week released recommendations on auction of spectrum, including those likely to be used for offering 5G services.
• The telecom regulator has suggested cutting prices of airwaves across various bands by 35-­40% from its earlier proposed base price.
• However, the Cellular Operators Association of India, whose members include the three private telcos, Bharti Airtel, Reliance Jio and Vodafone Idea, has expressed disappointment, given the industry’s demand for a 90% reduction in the prices.

What is Spectrum?

• Spectrum refers to the invisible radio frequencies that wireless signals travel over.
• Those signals are what enable us to make calls from our mobile devices, tag our friends on Instagram, call an Uber, pull up directions to a destination, and do everything on our mobile devices.
• The frequencies we use for wireless are only a portion of what is called the electromagnetic spectrum.
• Portions of electromagnetic spectrum are grouped in “bands” depending on their wavelengths—the distance over which the wave’s shape repeats.
• The full electromagnetic spectrum ranges from three Hz (extremely low frequency) to 300 EHz (gamma rays).
• The portion used for wireless communication sits within that space and ranges from about 20 KHz to 300 GHz.
• When we talk about radio spectrum, we are talking about the range of radio frequencies that are used for communicating.

How Does Spectrum Work?

• Because a range of spectrum frequencies can be used for cellular communications, different bands have slightly different characteristics.
• For the purposes of wireless communication, we can think of spectrum in three categories: low-, mid-, and high-band spectrum.
  • Low-band spectrum (under 3 GHz) travels longer distances with minimal signal interruption. Today’s wireless networks are built primarily on low-band spectrum, and the wireless industry has used this spectrum to build high-speed wireless networks.
  • High-band spectrum (above 24 GHz) travels much shorter distances—think meters, not miles—compared to low-band spectrum, but offers high capacity and ultra-fast speeds.
  • Mid-band spectrum (between 3 and 24 GHz) blends the characteristics of both low- and high-band spectrum—providing a mix of coverage and capacity.

Spectrum Auction:

• A spectrum auction is a process whereby a government uses an auction system to sell the rights to transmit signals over specific bands of the electromagnetic spectrum and to assign scarce spectrum resources.
• In India, the Department of Telecommunications (DoT) conducts auctions of licenses for electromagnetic spectrum.
• India was among the early adopters of spectrum auctions beginning auctions in 1994.

TRAI:

• The Telecom Regulatory Authority of India (TRAI) was established on 20th February, 1997 by the Telecom Regulatory Authority of India Act, 1997.
• Objectives of TRAI:
  • TRAI’s mission is to create and nurture conditions for growth of telecommunications in the country.
  • TRAI regulates telecom services including fixation/revision of tariffs for telecom services which were earlier vested in the Central Government.
  • It also aims to provide a fair and transparent policy environment which promotes a level playing field and facilitates fair competition.
• Headquarters: The head office of the Telecom Regulatory Authority of India (TRAI) is located at New Delhi.
• The function of the TRAI is to make recommendations on the following matters:
  • Need for introduction of new service provider.
  • Revocation of license for non-compliance of terms and conditions of licence.
  • Measures to facilitate competition and promote efficiency in the operation of telecommunication services to facilitate their growth.
  • Technological improvements in the services provided by the service providers.