Sistema hopeful of Indian govt addressing spectrum price issue

SSTL President and CEO Vsevolod Rozanov today said he was hopeful the Indian government will soon take a call on the issue of revising spectrum pricing in the light of lukewarm response to the 2G auction that concluded on Wednesday.

"The Indian government wants to find amicable solution (on spectrum pricing). To me, my focus is how to cut costs. I can only welcome this. Better late rather than never," he told reporters here.

Sistema Shyam Teleservices (SSTL), which provides CDMA services, has been arguing that there is no demand for the spectrum in which it operates and the prices set by government were very steep. The company also stayed away from the spectrum auction.

The government has set minimum price of pan-India spectrum in 800 Mhz band around 11 times high compared to amount which companies paid to get it in 2008. Rozanov said the telecom industry is awaiting the government's move on spectrum pricing which was considered very high during the recent auction.

He said the country plans to release 400 Mhz spectrum to the industry in next few years.

"It is a plausible intention, but we don't see how it will come and especially when spectrum pricing is high," he said.

Asked what would happen to MTS data customers after it decided not to participate in spectrum auction, Rozanov said, he hoped the issue would be looked into.

Asked whether the poor response for spectrum auction would affect investments in India, Rozanov said he did not think there is a direct link between auction and investment perceptions.

Asked how the parent company views the present situation in telecom industry, Rozanov said it is still quite optimistic about telecom market, but is very much concerned about the protection of the investments.

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