The Department of telecommunications (DoT) will discuss and analyse the issues arising out of TRAI’s recommendations on the spectrum auction on May 24, according to reports.  

The telecom secretary R Chandrasekhar said that the final decision will be taken after these recommendations are discussed in a DoT committee.

"Once we carefully go through the recommendations and study the various grounds and basis on which TRAI has given its recommendations, then only we can come to a conclusion. A committee in the DoT will study these and then they (proposals) will be placed before the Telecom Commission and a view will be taken. It will take time to study them since there is a lot of fine print," Economic Times quoted him as saying.

The telecom regulator in its reply to the government has defended the base price for the 2G spectrum auction at Rs 3,622 crore per MHz in the 1,800 MHz band.

TRAI recommendations have evoked sharp criticism from the Telecom companies who feel that TRAI recommendation will shrink the margins for them and would result in hike in call rates, which would almost double.

TRAI however contradicted this saying that it would have only marginal impact on tariff.

"The results (of Trai's analysis) indicate that mostly, the impact on tariff is less than 4 paise per minute and often much lower. This can be either absorbed by the service providers from the additional minutes that are generated or recovered through charges for different retail and wholesale services. The manner in which these will be recovered will vary amongst service providers depending on individual business strategies," the regulator said in its 60 page response to the government.

The regulator has, however, made some changes. Instead of auctioning only five MHz in each circle as proposed earlier, the regulator has said that that in nine circles, more spectrum, up to 10 MHz, could be made available for auction. The four more circles include Andhra Pradesh, Karnataka, Kolkata and Tamil Nadu.

“Where more than five MHz of spectrum is available after reserving it for auction and refarming, a total of 10 MHz in eight blocks of 1.25 MHz each may be put to auction instead of five MHz of spectrum.”,  

TRAI said that in states where sufficient spectrum is not available in the 800 MHz frequency, the government could consider lowering the reserve price.

The regulator said that the cancelled licensees would be treated as new operators, as they will have to apply for new licences. It however has increased the spectrum usage charges to three per cent from one per cent recommended earlier.