INVC NEWS
New Delhi — : A powerful alliance between Reliance Jio and Bharti Airtel, under the umbrella of the Cellular Operators Association of India (COAI), has raised serious concerns over India’s proposed satellite spectrum pricing structure. The dispute centers around the Telecom Regulatory Authority of India (TRAI) suggesting a significantly lower fee model for satellite broadband providers like Elon Musk’s Starlink, potentially giving them an edge in India’s fiercely competitive telecom market.
TRAI’s Proposal Triggers Industry Backlash
The controversy stems from TRAI’s recommendation to levy just 4% of annual revenue as spectrum fees for companies offering satellite broadband services. This proposed rate is considerably lower than what terrestrial telecom operators like Jio and Airtel are required to pay through costly spectrum auctions.
COAI has expressed that this policy creates a regulatory imbalance, disproportionately favoring satellite service providers. The association has stated that such a pricing structure would penalize existing telecom giants that have invested billions in infrastructure and licensing over the years.
Starlink Moves Closer to Indian Market Entry
Meanwhile, Starlink, Elon Musk’s ambitious satellite internet venture, is reportedly in the final stages of acquiring licensing in India. With over 5,000 satellites already launched, Starlink is on track to provide pan-India satellite internet coverage, making it a significant disruptor in the Indian broadband ecosystem.
COAI’s letter to the Ministry of Communications, dated May 29, underscores that the timing of Starlink’s entry—aligned with the proposed lower spectrum fees—could lead to an unfair competitive advantage, damaging the prospects of established telecom providers.
COAI’s Core Argument: Level the Playing Field
At the heart of COAI’s objection lies the demand for fee parity between satellite-based and terrestrial spectrum. The association emphasized that traditional telecom operators must pay high upfront fees via auction, while satellite operators are being offered a heavily subsidized entry path.
COAI’s analysis shows that the proposed satellite spectrum fees are 21% lower than what terrestrial providers pay. The association argues that when similar services are delivered to the same end users, the cost of spectrum per megahertz should be equal across technologies.
Why This Matters for India’s Telecom Ecosystem
India’s push toward digital inclusivity hinges on affordable and equitable internet access. While Starlink’s satellite internet may serve remote regions where fiber and mobile networks struggle, established players fear losing urban and semi-urban markets if regulatory support skews the balance.
Jio and Airtel contend that the move risks disincentivizing investment in terrestrial networks, potentially slowing down 5G expansion and rural broadband rollouts.
Spectrum Pricing: A Test for Policy-Makers
This escalating dispute puts the Indian government at a critical crossroads. The decision on spectrum pricing will shape the future landscape of India’s broadband market. While encouraging innovation and new entrants like Starlink is essential, failing to ensure fair competition could undermine the financial viability of long-standing domestic telecom operators.
The government must now weigh the benefits of lower-cost satellite internet against the risk of eroding the business models of companies that have long formed the backbone of India’s digital infrastructure.
COAI Seeks Urgent Government Intervention
COAI has urged the Telecom Ministry to re-evaluate TRAI’s recommendation and implement a spectrum pricing model that promotes fairness and sustainability across the board. The association maintains that spectrum—whether satellite-based or terrestrial—should not be priced based on technology alone but on the value and impact of services delivered.
By calling for uniform pricing rules, COAI aims to prevent a regulatory environment that favors one player over another, ensuring that innovation doesn’t come at the cost of legacy networks that continue to support over a billion Indian subscribers.
