Indian GSM mobile firms "climbdown" in spectrum row

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GSM operators say their expansion plans are constrained by a paucity of spectrum in the world's fastest growing telecoms market, which has 12 telecom firms offering wireless services to 225 million subscribers.

After months of legal wrangling, the GSM operators' lobby said on Wednesday it would accept revised government policy which will raise by between 2-6 times the minimum number of subscribers an operator needs to be eligible for additional spectrum.

The Cellular Operators' Association of India (COAI), however, said it would continue to legally oppose a government move to allow CDMA operators like Reliance Communications Ltd to provide services using GSM technology.

"It is a climbdown, it is damage limitation. The government was on the verge of accepting recommendations that were even more damaging," Mahesh Uppal, director of telecoms consultancy firm First Com, said over the telephone.

The lobby group represents operators like top mobile firm Bharti Airtel Ltd, Vodafone Plc- controlled Vodafone Essar and Idea Cellular Ltd.

"Our main challenge is the allotment of GSM spectrum to CDMA operators," COAI Director-General T.V. Ramachandran said after the body had accepted the new rules originally put forward by the industry regulator.

Bharti and Idea declined comment, and officials from Vodafone Essar were not immediately available.

Forty-six firms additional firms want to receive licences to run mobile services in India where the lowest call rates in the world are attracting more than 8 million new users a month.

Reliance Communications, which has received the nod to launch GSM services, sent a legal notice to the government asking it to hold off allotting additional spectrum to GSM operators as a panel of government experts had recommended still higher benchmarks.

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