In order to express its concern over linkage of spectrum usage charges (SUC) to revenue, Internet Service Providers Association of India (ISPAI) is planning to move toward Telecom Minister Manoj Sinha and also the telecom secretary this week. The sector regulator, Telecom Regulatory Authority of India (TRAI) has sought public feedback on levying SUC linked to annual revenues for internet service providers (ISPs), something similar to the norms for mobile companies. The move could potentially push up broadband costs for consumers as ISPs currently pay ‘formula-based spectrum charges’.
ISPAI President Rajesh Chharia pointed out that spectrum is being used as the last mile access where optical fibre does not reach, in order to connect the unconnected people. Thus, any additional charge on spectrum will lead to a hike in the cost of service and will have an adverse impact on internet proliferation in rural areas. President further said that the formula-based spectrum charges work out to Rs 7.2 lakh for 6MHz spectrum for one year and they opposed to Trai's proposal of imposing SUC linked to revenue.
As per TRAI, at present, the service providers with Cellular Mobile Telephone Services and Unified Access Service Licence are assigned spectrum through market-based mechanism (auctions) and pay SUC on the basis of percentage of their gross revenue called AGR. However, there are certain categories of telecom and broadcast licenses to whom spectrum is assigned administratively and SUC is based on a formula-basis. ISPs are among such licensees. Besides, it has set September 19 as the last date for receiving comments and October 3 for counter-comments.