India’s telecom regulator, the Telecom Regulatory Authority of India (TRAI), has released its recommendations regarding the pricing of spectrum for satellite-based internet services, suggesting that these operators pay 4% of their Adjusted Gross Revenue (AGR) as spectrum charges. This proposal, unveiled on Friday, will now be considered by the Department of Telecommunications (DoT).
According to TRAI’s recommendations, satellite communication companies, including those using both geostationary orbit (GSO) and non-geostationary orbit (NGSO) satellites, would be subject to this 4% AGR spectrum fee. Additionally, operators providing services in urban areas would need to pay an extra annual fee of ₹500 per subscriber. However, this additional levy would not apply to subscribers in rural areas.
Furthermore, TRAI has proposed a minimum annual spectrum charge of ₹3,500 per MHz for all satellite broadband operators, irrespective of their revenue. The regulator has also suggested that the spectrum allocation period should be five years, with the possibility of a two-year extension. Alongside the spectrum charges, an 8% license fee is also reportedly applicable to these players.
TRAI Chairman Anil Kumar Lahoti emphasized that satellite communication services can play a crucial role in extending connectivity to underserved regions where traditional telecom networks are not present, as well as in disaster relief operations.
The Indian Space Association (ISpA) has acknowledged TRAI’s recommendations, stating that the proposed framework balances the government’s need for revenue with the necessity of keeping satellite services affordable and accessible, while also ensuring a level playing field within the industry.
It’s worth noting that satellite companies had previously lobbied for a spectrum charge lower than 1% of AGR, with no additional subscriber-based fees. Major telecom players like Reliance Jio and Bharti Airtel had also advocated for an auction process for satellite spectrum allocation, fearing that administrative allocation at a pre-determined price would give players like Starlink an unfair advantage.
Based on TRAI’s recommendations, the DoT will now approach the Cabinet for a final decision on the pricing of satellite spectrum. Once approved, any satcom operator wishing to offer services in India can apply for the necessary licenses.
Key Highlights:
- TRAI has recommended that satellite internet service providers pay 4% of their AGR as spectrum charges.
- An additional annual fee of ₹500 per subscriber will apply in urban areas, but not in rural areas.
- A minimum annual spectrum charge of ₹3,500 per MHz has also been proposed.
- The recommendations aim to balance government revenue with the affordability of satellite services.
- The DoT will now consider these recommendations for final approval.