Telecom regulator countered arguments that its suggestions of fixing the spectrum levy at 4% will distort the market or deal a blow to terrestrial players, such as Reliance Jio and Bharti Airtel

FPJ News Service mumbai

The Telecom Regulatory Authority of India (TRAI) on Friday released recommendations on the terms and conditions for the assignment of spectrum for certain satellite-based commercial communication services. The telecom regulator recommended that satcom companies pay 4% of their adjusted gross revenue as spectrum charges to the government, a rate steeper than what satcoms had been lobbying for.

“Operators offering satellite-based broadband internet services in urban areas would have to shell out an additional Rs 500 per subscribers annually,” TRAI said in its recommendations to the Department of Telecommunications. No additional levy would be applicable for services in rural areas. TRAI said the 4% of AGR spectrum charge would be subject to a minimum annual spectrum charge of Rs 3,500 per MHz. 

Starlink and Amazon Inc's subsidiary Kuiper Systems had during consultations with the TRAI urged it to keep spectrum charge below 1% of AGR with no other charge. TRAI recommended that satellite broadband spectrum be allotted for five years, which can be extended by another two years. The satellite spectrum pricing as a percentage of AGR is for both non-geostationary satellite orbit and geostationary satellite orbit-based fixed-satellite service and mobile satellite service.

NGSO refers to satellites occupying either a low-earth orbit (LEO) or medium-earth orbit (MEO). Unlike geostationary GSO satellites, LEO and MEO satellites do not occupy a stationary position but move in relation to the Earth. AGR is used to calculate the revenue that telecom companies share with the government in the form of spectrum usage charges and license fees.