An internal committee, set up by Department of Telecom on Trai recommendations on spectrum pricing and licensing framework, is understood to have disagreed with the sectoral regulator on various points and has sought its views on these issues again.

The Telecom Regulatory Authority of India (Trai) had proposed that under new licensing regime, annual licence fee should be 6 per cent of annual gross revenue (AGR) but the DoT committee wants it to be higher at 8.5 per cent of AGR.

Although the DoT panel has agreed to the new licence categories and their fees, it has rejected Trai proposal to implement it from April 1, 2012 that was aimed at creating level playing field between new and old service providers.

Trai recommendations on spectrum pricing and management proposed an entry fee of Rs 20 crore for Nationwide Unified licence, which the panel has accepted.

It recommended entry fee of Rs 2 crore for the Metros and Category A service areas; Rs 1 crore for Category B and Rs 0.5 crore for Category C service areas. For V-SAT licences, Trai recommended an entry fee of Rs 30 lakh and Rs 10,000 for licences through authorisation.

Under the present framework, telecom licences can be given on First-Come, First-Serve basis, where a unified access service licence comes bundled with 6.2 Mhz spectrum. The last pan-India licences were issued for Rs 1,658 crore in 2008.

Since the new licences will not have spectrum bundled with them, an applicant will only have to pay entry fee which will be finalised by DoT. DoT has agreed with Trai's view that in future there will be only four kind of licences -- Unified licence, Class licence, Licensing through Authorisation and Broadcasting licences.

Unified licence will enable operators to offer all services -- CMTS, NLD, ILD, Internet, IP-I and Global Mobile Personal Communication by Satellite (GMPCS). The committee has sought further recommendations from Trai on GMPCS services under state level Unified License.

Class licence will cover VSAT services, while licensing through authorisation will cover Public Mobile Radio Trunk Service (PMRTS), radio paging, voice mail, audio tex, unified messaging service.

DoT's committee has asked to keep broadcasting licences under purview of the Information and Broadcasting Ministry.  Under the new proposed framework, the licences will not be bundled with spectrum. An applicant will have to choose a license for the kind of service he wants to provide and pay separately for spectrum required to run the service. The DoT panel has accepted Trai view on per Mhz spectrum price in the 1800 Mhz frequency band up to 6.2 Mhz at the time telecom operators apply for extension of licence.

It has asked Trai to resend per Mhz price for CDMA services, for up to 5 Mhz, which would be applicable at the time of extension of license. Trai defined contracted limit of 6.2 Mhz for GSM players and 5 Mhz for CDMA players.

While Trai has given pricing of spectrum for contractual limit to be applicable from April 1, 2010, the DoT panel wants telecom regulator to come up with recommendation on current prices by the end of every calendar year which shall be valid for subsequent financial year.

Trai has also recommended 'one-time' entry fee for additional spectrum beyond 6.2 Mhz, which was widely opposed by incumbent telecom operators. The DoT committee, in an internal note, is said to have agreed to charge operators as per Trai formula.

However, the committee has pointed to in a case -- filed GSM industry body Cellular Operators Association of India in Supreme Court against TDSAT judgement -- that the association does not have any vested right to receive GSM spectrum beyond 6.2 Mhz of spectrum. The outcome of the judgement will be crucial in determining contracted limit of spectrum.