Government of India is yet to say ‘no’ to a request by Bharat Sanchar Nigam Ltd for the allocation of one block of spectrum in the precious 700 MHz band to enable it to launch 4G services in rural areas.
The company had sought one block of 700 MHz spectrum in return for issuing new shares in the company to the government. However, given that the state already owns 100% of BSNL, it is not clear how issuing more shares to the government would benefit the latter.
“We are yet to take a decision,” said a senior official of the Department of Telecom.
BSNL currently has 4G-suitable spectrum in 14 out of India’s 22 telecom zones.
However, it doesn’t have any 4G spectrum in crucial states like Tamil Nadu, Maharashtra, Andhra, Telangana and Karnataka.
Moreover, it doesn’t zero airwaves in the ‘lower’ bands such as 700 MHz, 800 MHz and 900 MHz, which are essential for covering large areas at low costs.
It wrote to the government last year seeking one 5 MHz block in the 700 MHz band — out of a total of seven available — to enable the launch of the company’s 4G services across the country at a low cost.
It is estimated that a single tower on 700 MHz spectrum can cover about 10 times the area that a 2,500 MHz tower can — though the total data carrying capacity of both towers will be the same.
2100 MHZ OPTION
The company has also given the Department of Telecom the option of allotting it a single 5 MHz block in the 2100 MHz band — also known as the 3G band.
Unlike the 700 MHz and the 2500 MHz, the 2100 MHz band is supported by nearly all 4G handsets in India as it is designated as ‘Band 1’.
Getting 2100 MHz band for 4G would enable BSNL to rapidly roll-out its LTE services without worrying about handset support.
However, like in case of 2500 MHz, the maximum area that can be covered by a single tower is in the 2100 MHz band is only one-third or one-eighth that of a 700 MHz base station.
As such, BSNL has kept it as a less preferable option, to be exercised in case the government feels that it cannot allocate 700 MHz spectrum practically free of cost to BSNL.
Due to high reserve prices, the lucrative spectrum did not find any takers in last year’s auction. It will again be put on sale this year, but with a reduced reserve price.