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No justification for allocating spectrum to PSUs, private cos for captive networks: COAI

Industry body COAI on Wednesday said there is no justification for allocating radiowaves directly to enterprises for operating private captive networks

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New Delhi: Industry body Cellular Operators Association of India (COAI) on Wednesday said there is no justification for allocating radiowaves directly to enterprises for operating private captive networks, and that licensed telcos are fully capable of providing all customised solutions in the most competitive and economic manner to private and public sector entities.

The comments of COAI, whose members include Reliance Jio, Bharti Airtel, and Vodafone Idea, assume significance as telcom operators and tech companies have locked horns over the hotly-debated issue of 5G spectrum allocation and captive private networks.

Private enterprises have asserted that giving spectrum directly for the creation of captive networks, without any dependency on telcos, would accelerate the digital agenda.

Refuting this stand, COAI in its position paper on 5G private networks, has urged the government not to reserve or de-license any spectrum which has been identified or likely to be identified for use of mobile services, towards private captive networks.

Doing so, COAI said, would amount to “undue advantage to private commercial entities at the cost of government exchequer.”

Moreover, it would lead to arbitrariness in basic policies “discouraging investment in the networks and leading to disorderly growth of the sector by back door entry, with undue advantage, to private commercial entities at the cost of the government exchequer”.

At present, the means for operating such private network are made available from the resources of licensed telecom service providers which include spectrum acquired through a transparent auction process.

“We are of the firm opinion that notwithstanding any advancement of technologies, there is no justification whatsoever for allocating spectrum to industry verticals for operating private captive networks,” COAI said in the run-up to 5G spectrum auctions.

The auctions for 5G spectrum are slated to be held mid this year.

The licensed access service providers are fully capable of providing all customised solutions including machine to machine (communications) and industrial 4.0 services in the most competitive and economic manner, and are in fact providing such network configurations to private and public sector entities.

According to COAI, there is no case to alienate spectrum directly to companies for captive private networks.

Any de-licensing/reservation of mobile spectrum for captive industrial use or establishment of private networks, as demanded by few companies, would not only cause huge loss to the exchequer but will also lead to sub-optimal utilisation of this scarce resource, COAI wrote.

Such move is not only technically uncalled for but also legally untenable, it claimed.

“Hence, such a move is also technically uncalled for. Sufficient unlicensed spectrum bands are available to cater these private network requirements for captive networks,” it added.

COAI went on to say that in today’s scenario there is no need for separate private captive networks, and same should be dispensed with given the availability of state-of-art telecommunication network.

“Private captive networks can be detrimental to national security. The licensed access service providers are fully capable of providing these services in most competitive and economic manner compared to private companies looking for such solutions,” COAI said in the position paper.

When a private network is part of a commercial network, it paves the way for orderly growth of the sector.

“Neither the legitimate revenue of licensed service provider is truncated nor there is any revenue loss to the Government exchequer in terms of payment for acquiring spectrum through auctions and payment of license fee and Spectrum Usage Charge (SUC),” it said.

This approach also adheres to the principle of Same Service Same Rules.

(With PTI inputs)

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