Frequent auctions, inadequate spectrum a big issue
Telecom secretary Rakesh Garg is right when he says the worsening call drops are not related only to the lack of telecom towers and that telcos need to fix their networks. But the solution, and a large part of the blame, also lies with government. The rapidly deteriorating call quality in Delhi, for instance, is directly related to the fact that the biggest telcos, Bharti Airtel and Vodafone, lost 2 and 3 MHz respectively of their 900 MHz spectrum in the 2014 auctions when bids went sky-high—both telcos then had to move part of their traffic to the 1800 MHz band, and network optimisation takes time. Indeed, this will get repeated once telcos who lost spectrum in the 2015 auctions have to shift subscribers to other bands. Indeed, as the DoT/finance ministry want to keep maximising their revenues—had 15 MHz of defence-vacated spectrum been put in the 2015 auctions, bids would have been lower—operators will keep losing their spectrum, necessitating reconfiguring their networks. The telecom ministry’s argument that there is enough spectrum—why else wasn’t all the spectrum sold in the 2014 and 2015 auctions, it argues—is also incorrect. The spectrum was unsold because it was too expensive or because it was not contiguous—odd rules where old/new bidders had to bid in different lots of spectrum aggravated the problem. Relaxing caps on spectrum sharing will alleviate the problem, so the sooner the ministry addresses this, the better.
While spectrum is at the heart of the call-drop issue—since Indian telcos have 12MHz of spectrum vs a global average of 40MHz, they get less spectral efficiency and need more towers—the lack of towers is a very serious issue. For a leading operator in Delhi, the number of towers available in Lutyens Delhi is around half that is required—for the top 6 cities, the shortage of towers in critical areas is around 800. The telecom minister has done well to ask PSUs/government offices to allow telcos to put up towers, but he needs to both lower the cost of spectrum as well as make more available—once there is greater spectral efficiency, the problem of tower shortages will also ease.