Jio, Airtel oppose pricing move that might benefit Musk's Starlink
What's the story
Indian telecom giants Reliance Jio and Bharti Airtel have expressed concern over the proposed pricing of satellite spectrum in India.
The companies, represented by the Cellular Operators Association of India (COAI), argue that if priced too low, it would unfairly benefit satellite internet services like Elon Musk's Starlink.
They say that traditional telecom players pay significantly more for spectrum through auctions.
Pricing concerns
What did COAI's letter say?
In a letter dated May 29, the COAI requested a review of the proposed pricing for satellite spectrum.
The association highlighted that traditional telecom companies pay much higher upfront auction charges for their spectrum.
This, they say, makes their payments to the government roughly 21% higher than what satellite players would pay.
The letter stressed that "price per MHz should be equivalent or at least comparable for both," especially when reaching same consumers with identical services.
Market impact
Concerns about offering same services but paying more
Telecom players are worried that they shall be offering similar wireless broadband services as satellite operators but paying much more.
This concern is especially relevant given the massive investments made by companies like Reliance Jio and Airtel in acquiring 5G spectrum through auctions.
The COAI letter also noted that "satellite services can provide competitive, affordable alternatives to terrestrial broadband."
Regulatory review
Telecom Ministry still reviewing pricing recommendations
A senior Indian government official told Reuters that the Telecom Ministry is reviewing the pricing recommendations made by the regulator.
The official noted that similar industry concerns have been raised in the past.
Reliance and Airtel have signed distribution deals for Starlink equipment but shall continue to compete with Musk's offerings once launched.