One year on, govt fails to auction 3G, 4G services

THE government has failed to auction spectrum for third generation (3G) and fourth generation (4G) services based on the spectrum policy implemented last year. This has resulted in delays in making new services available in the market and left the telecom sector hard hit. In November 4 last year, the Ministry of Information and Communications (MoIC) had introduced the “Telecommunication Service Radio Frequency (Distribution and Pricing) Policy 2012”, fixing new pricing for frequencies and plan for effective distribution of the scarce resource. However, officials at the Nepal Telecommunications Authority (NTA) admit that the policy has become just a guideline to collect a spectrum fee rather than pushing for development in the sector. Two major telecom companies, Ncell and Nepal Telecom (NT), have been planning to roll out 4G service for the last three years and had sought spectrum required for the this technology. Based on the policy, the MoIC was supposed to form a committee to study the international practice, pricing and auctioning procedure, however this has not made any headway to date. The spectrum policy was devised with a focus on the auctioning of high value spectrum such as 3G and 4G, re-framing these resources, and carrying out regulatory monitoring by the MoIC and NTA on use of airwaves by the telecom companies. It had also talked about taking back the frequencies from companies that are using more than government set limit, and fixing frequency for emergency telecommunication management. The policy has not been implemented effectively due to the controversies regarding the appointment of NTA Chairman Digambar Jha and unified telecom licence, according to the Nepal Telecommunications Authority (NTA) which is responsible for implementing the policy. The authority only collected fees based on the policy from the telecom companies and assigned 2 Mhz spectrum to Smart Telecom that received the unified licence or Basic Telephone Service amid the controversy. Ananda Raj Khanal, acting chief of the NTA, said that they were focusing on frequency fee collection in the absence of a Chairman to make policy level decisions. “We are just waiting for the court’s decision regarding the NTA Chairman and the unified licence,” he added. Currently, a case against the appointment of NTA Chairman Digambar Jha is under consideration of the Supreme Court. Similarly, cases regarding the unified licence are also subjected in the court. The existing Telecommunications Act holds NTA Chairman as the key person on making any policy decisions. Based on the policy, the NTA collected around Rs 3 billion spectrum fees from telecom companies and this is considered as one of the best results of the policy impact. The amount collected includes: charges for 3G spectrum assigned to Ncell and NT, fees for additional and maximum spectrums being used by companies and limited mobility service. Previously, there was no specific provision regarding charges on 3G frequency. NTA officials admit that the policy has become just a guideline to collect a spectrum fee