Dual-technology debate resurfaces

The controversy over the allocation of 2G spectrum under former telecom minister A Raja to CDMA operators refuses to die.

The latest was the turn of a government official to write a letter pointing out how two traditional CDMA operators do not have to re-buy their 2G spectrum like Uninor, MTS and others.

He argues that if the problem with Raja’s 2G spectrum allotment was with the price, then a higher price must be charged from the CDMA operators also.

“One of the reasons why allocation of 2G spectrum in 2008 is termed scam is that spectrum was allocated well below the market price..” JS Deepak, Joint Secretary to Wireless Advisor on the issue of auctioning of spectrum wrote in a intra-departmental letter.

“CDMA operators were given 4.4 MHz spectrum in the 1,800 MHz band at the same price charged from the GSM operators whose licences have been cancelled by the Supreme Court,” he points out.

The argument is not new, but is the subject of a case in the Supreme Court.

Several industry officials, particularly from the established GSM operators, had noted with consternation that not all spectrum allotments made by A Raja were cancelled by the Supreme Court.

It cancelled only about two-thirds of the license and spectrum allotments made by Raja.

The primary basis for cancellation was that A Raja seemed to have manipulated the allocation process midway through a press release to suit some parties.

Therefore, according to the Court judgment, the main reason for scrapping the licenses was not the price at which the allocations were made. It did, however, note that because the licenses were being sold dirt cheap, there was added incentive to manipulate the system.

As such, the Supreme Court found Raja’s midway modification malafide, and cancelled all the license allocations that were made after A Raja changed the policy by issuing a press release.

Technically, the CDMA operators were not allotted new licenses like the others, but only new spectrum under their old (till then, CDMA) license.

In addition, the GSM operator’s body, COAI (the Cellular Operators’ Association of India) approached the Telecom Disputes Settlement & Appellate Tribunal almost immediately after the 2G spectrum was awarded to CDMA operators.

The case too ultimately ended up in the Supreme Court as well, with the difference that the Court has not issued a judgement on it yet.

The CDMA operators’ association, AUSPI (the Association of Unified Service Providers of India), was quick to point out that the case is still in court.

“Though COAI has filed an appeal in May 2009 before Hon’ble Supreme Court, TDSAT judgment has not been stayed,” AUSPI said in a statement today.