India: TRAI Guidelines On Spectrum Sharing

Last Updated: 24 February 2016
Article by   Trilegal

The TRAI recommendations on spectrum sharing could be the next logical step in the development of India's telecom sector. The gains in network efficiency that sharing can provide will benefit operators and customers alike. However, the detailed terms and conditions suggested by the TRAI in its draft recommendations could have broader repercussions than immediately apparent

The Telecom Regulatory Authority of India (TRAI) has released its recommendations on 'Guidelines on Spectrum Sharing' (Proposed Guidelines) suggesting that sharing of spectrum between operators should be permitted, as long as certain minimum conditions are fulfilled. If accepted by the Government, this will be the next logical step towards the development of a modern telecom network in the country.


In the decades before liberalisation of the telecom sector, the state owned monopoly, BSNL (MTNL in the metros) had had dismal success in rolling out telecom infrastructure through the length and breadth of this country. Which is why, when the government finally opened the sector to private sector ownership, it did so with policies aimed at encouraging the development of telecom infrastructure in order to increase telecom penetration in the country so much so that the initial regulatory framework forced telecom companies to invest in building their own infrastructure. As a result, the early pioneers of the Indian telecom market built their own towers, created their own infrastructure and jealously guarded their assets – as that was what gave them the competitive advantage over their competitors and the incumbent.

In 2004, amendments to the telecom regulations allowed telcos to share passive infrastructure. However, this was an idea that took some time to catch on, and in April 2007 less than 25% of the sites had implemented passive sharing of infrastructure. It took three telecom giants – Vodafone Essar, Bharti and Idea Cellular to join hands in an unprecedented partnership that saw each of them throw their infrastructure assets into a joint venture called Indus Towers, to demonstrate that infrastructure could be shared efficiently and profitably. Indus Towers is now the country's largest tower infrastructure company and provides passive infrastructure to multiple operators outside of the three principal shareholders.

Today, passive infrastructure companies form the backbone of the Indian telecom industry. All Indian telcos rent at least part (if not all) of their passive assets such as towers, generator sets, etc. from massive tower companies whose sole business is to manage these tower assets that dot the length and breadth of the country. It was this ecosystem of passive infrastructure companies that allowed new entrants in 2008, including Uninor, Etisalat and Videcon, to roll out their operations in the country as quickly as they did – a feat they could never have hoped to complete if it were not for sharing models that allowed them to significantly reduce their time to market.

While the passive sharing ecosystem grew rapidly in the country, the sharing of active network elements is yet to gain traction in India. Although the DoT allowed the sharing of RAN, antennae, feeder cables etc. in April of 2008, there has been little, if any, implementation of 13 August 2014 The TRAI recommendations on spectrum sharing could be the next logical step in the development of India's telecom sector. The gains in network efficiency that sharing can provide will benefit operators and customers alike. However, the detailed terms and conditions suggested by the TRAI in its draft recommendations could have broader repercussions than immediately apparent. active infrastructure sharing by telcos. One major concern cited by operators relates to the lack of clarity in the regulations as to how the active elements of the infrastructure can be shared without impinging on the prohibition against spectrum sharing. Given this uncertainty, most operators may have decided against sharing their RAN at all. In addition, others have cited technical difficulties in making the equipment of both the telcos interoperable, and the operational challenges attendant on the complex negotiations and sharing of confidential subscriber data with tower companies and competitors that this would entail.


Today, telcos continue to be saddled with high capex and operational costs, making it difficult to develop high- capacity networks to service India's growing mobile market. Monthly ARPU for GSM services is at INR 113 (TRAI: March, 2014) and OTT services have hit traditional revenue generators such as SMS and VAS. Besides profitability concerns, network inefficiencies have also resulted in poor service across the board. Telcos have complained that inadequate spectrum is the direct cause of the falling quality of service (QoS) standards and have raised demands for the release of additional spectrum in order to address this.

The Proposed Guidelines seek to address network efficiency concerns by allowing telcos to leverage non- linear gains in spectral efficiency. This can be better explained in the context of the chart reproduced below. If two operators holding 5 MHz of spectrum each were to share their spectrum, it is possible to minimise network congestion and carry greater amounts of traffic. While the two operators in this example can cumulatively carry 66.06 Erlangs of network traffic without sharing spectrum, implementing a sharing model would allow them to carry 138.08 Erlangs, which is more than double the sum of their individual capacities.

Key Aspects of the Proposed Guidelines

In this context it is important to understand the key elements of the proposed guidelines to understand better how they impact consumers and telecom companies in India.

Inter-band sharing

The Proposed Guidelines permit sharing between two access licensees, provided both licensees have spectrum in the same circle and in the same band. This condition could have a significant impact given the superiority of some frequency bands over others. For instance, the 900 MHz band is widely acknowledged to be more efficient over a greater distance than the 1800 MHz since the lower frequency produces higher wavelengths, allowing these signals to travel greater distances far more efficiently than the higher bands.

Under the Proposed Guidelines, early entrants such as Airtel and Vodafone will not be able to share their spectrum in the 900 MHz band with new players such as Uninor or Videocon that hold spectrum in the 1800 MHz band. Reliance Jio (2300 MHz and 1800 MHz) and Reliance Communications (800 MHz and 2100 MHz) will also be hit by the ban on inter-band sharing, based on their current spectrum holdings.

Usage Charges and Share of Spectrum

The Spectrum Usage Charge (SUC) will be chargeable on the entire service area, even if a portion of it is used to build a common RAN and share spectrum. The revised SUC is illustrated as follows: SUC Prior to Sharing 6% of AGR After sharing 6.5% of AGR Since this is only a marginal increase, it is hardly likely to discourage operators from sharing their spectrum holdings. In fact, sharing could be seen to be a viable alternative to mergers and acquisitions (M&A) as a path to acquiring additional spectrum, given that, under the new M&A guidelines, operators are obliged to true up the value of any acquired spectrum that has been administratively allocated.

While the Guidelines for Mergers and Acquisitions, released by the DoT in February of 2014, pegs the market cap for spectrum of the resultant entity at 50% of the total spectrum assigned in that band in a service area, the Proposed Guidelines recommend the application of a new formula in the context of spectrum sharing, as follows: 0 100 200 Individual Cumulative Sharing Without sharing 33.03 66.06 138.8 Values in Erlangs of traffic Non-linear gains in spectral efficiency (in Erlangs of traffic) 138.08 > (33.03 + 33.03) x 2 3 Before sharing After sharing Licensee 'A' X X + (Y/2) Licensee 'B' Y Y + (X/2) This could, however, play out differently in different bands depending on the competition. For instance, since there are as many as eight operators in the 1800 MHz band in the Mumbai circle, it is unlikely that the prescribed spectrum caps will be breached in Mumbai if any two telcos agree to share spectrum. On the other hand, only three or four operators currently hold spectrum in the 800 MHz (CDMA), 2100 MHz (3G) and 2300 MHz (BWA) bands across all circles. Sharing of spectrum between two out of three operators will probably be hit by the spectrum cap under the Proposed Guidelines. It is reasonable to expect that we will see more spectrum sharing agreements being entered into for 2G GSM services, as opposed to the CDMA, 3G, BWA bands.

Unliberalised spectrum

Pursuant to spectrum sharing, if any one of the two licensees holds unliberalised spectrum, both operators can provide only those services which are permitted using the unliberalised spectrum. This regulation is likely to particularly affect early entrants such as Vodafone and Bharti Airtel, which continue to hold unliberalised spectrum, and could be a disincentive to sharing if the earlier players are looking to retain any advantages they get from holding off from migrating to the unified license regime. On the other hand, the regulator will probably be hoping that the benefits afforded by spectrum sharing will be the impetus that they require to make the migration to a unified regime.


The Proposed Guidelines expressly prohibit spectrum leasing, involving the transfer of usage rights in spectrum to another party. Having said that, it is possible that spectrum trading will be permitted in the near term, given TRAI's recent publication of the 'Working Guidelines on Spectrum Trading'.

Roll-out obligations and QoS

Under the Proposed Guidelines, existing roll-out obligations and the prescribed QoS standards will continue to apply to operators who share spectrum. Therefore, regardless of whose RAN is being shared, the telco will be answerable to customers and the DoT in relation to its roll-out and QoS obligations.


These figures are based on publicly available information and may vary. Trilegal cannot guarantee the accuracy of this data. Impact on the Industry There is little doubt that these Proposed Guidelines will have a profound impact on the industry as it exists today. Both, larger telcos such as Airtel, Vodafone and Idea and smaller telcos such as Uninor and Videocon operating in the 2G GSM band stand to benefit from spectrum sharing in several circles where one holds a greater quantity of spectrum compared to the other. In the Mumbai circle, the existing spectrum holdings of operators is as follows:1 900 MHz 1800 MHz 2100 MHz 2300 MHz Airtel 5.0 15.2 5.0 20 Vodafone 11.0 8.2 5.0 - Idea - 6.4 - - Reliance Jio - 6.6 - 20 Reliance Comm. - 5.0 5.0 - TTSL - 4.4 - - Aircel - 4.4 - - Airtel could clearly share its spectrum holding in the 1800 MHz band with Vodafone, in the same band in the Mumbai circle. Similarly, Airtel and Idea could consider entering into a spectrum sharing agreement for the 1800 MHz band, and still remain within the prescribed spectrum caps. Even smaller players such as TTSL and Aircel that hold spectrum in the 1800 MHz band in Mumbai can improve their network efficiency by sharing spectrum with each other. However, the Proposed Guidelines would not permit spectrum sharing across the board between Reliance Jio and Reliance Communications – two companies widely reported to be entering into extensive infrastructure sharing agreements. The table below lists their spectrum holdings in different frequency bands: Reliance Jio Reliance Communication 800 MHz No Yes 1800 MHz Yes Yes 2100 MHz No Yes 2300 MHz Yes No Although old telcos that hold larger quantities of spectrum are most likely to gain from the Proposed Guidelines, the gains in network efficiencies from 4 sharing would be available to all telcos, irrespective of their spectrum holdings. Given the current spectrum holdings and the prescribed spectrum caps, the Proposed Guidelines do not favour CDMA, 3G and BWA band sharing in most circles. Once the guidelines have been finalised, telcos wishing to enter into spectrum sharing arrangements will have to carefully analyse commercial terms and take adequate precautions in drafting their sharing agreements to allocate responsibility in rectifying QoS failures and to address the operational details in coordinating with tower companies.

If there is one thing that the government should re- consider, it is possibly the restriction on inter-band sharing that would clearly hamper the ability of telcos to deploy next-generation networks. The Proposed Guidelines have been designed to encourage network efficiency, and there is no doubt that operators who share spectrum will experience improvements in traffic carriage.

It is likely that the government recognises the need to implement spectrum sharing if it wants to achieve its ambitious broadband penetration target of 175 million connections by 2017. This target will only be reached if telcos employ RAN-sharing models in both rural and urban areas, and may require the state-owned BSNL to be open to sharing agreements with private players in rural areas where it has the maximum coverage of all the telcos. While BSNL has, historically, been reluctant to enter into sharing agreements, despite its vast wireline infrastructure being largely underutilised with over 4,000 microwave repeater stations sitting idle across the country, its active participation will unlock tremendous potential for rural consumers of telecom services.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.