The Hindu Business Line : DoT allows telcos to share infrastructure except spectrum

Progressive move
Active infrastructure sharing will bring down the cost of rolling-out telecom network infrastructure resulting in lower tariffs.
A win-win development for Govt, industry & users.

Our Bureau

New Delhi, April 1

In a move that would bring significant reduction in costs for rolling out telecom network, the Government has allowed operators to share all parts of the infrastructure except spectrum. This is expected to enable operators to save nearly 30 per cent of their costs which in turn will result in cheaper tariffs for consumers.

Until now, operators were allowed to share only the passive part of the infrastructure which include towers, power equipment and air-conditioning at various cell sites. Almost 60 per cent of the passive infrastructure is currently on a shared basis bringing nearly 40 per cent reduction in the operator’s capital expenditure.

But now, operators will be able to share active infrastructure which is essentially the technical equipment needed to transmit mobile calls such as antenna, feeder cable, radio access network and transmission system. While spectrum sharing has been barred, this decision will have no impact on the operator’s business since most of them are already working on full capacity. It will also have no impact on DoT’s future decision on allowing Mobile Virtual Network Operators as this involves selling bulk airtime only and not sharing of spectrum.

Tata Teleservices, which recently announced a franchisee agreement with Virgin Mobile, said, “We welcome the DoT’s progressive move to allow active infrastructure sharing. This move will significantly bring down the cost of rolling-out telecom network infrastructure resulting in lowering of tariffs and increase in telecom penetration. This is a win-win development for the Government, industry and consumers.”

In order to encourage operators, DoT will also give financial incentive from the Universal Services Obligation fund to all who share infrastructure in rural areas. Mr T.V. Ramachandran, Director General, COAI, said, “Provisions such as sharing of active infrastructure, further simplification of frequency allocation procedures, enhancement in scope of the USO subsidy support scheme, would herald a significant acceleration in the growth and expansion on networks and coverage.”

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