Reliance Communications (RCOM) and Reliance Jio Infocomm are said to be preparing to share spectrum supporting fourth generation (4G) mobile services over the 800 MHz band across 10 circles.
The spectrum sharing deal will allow Reliance Jio to use 10 MHz of contiguous 4G bandwidth in Mumbai, UP-East, Orissa, Madhya Pradesh, Bihar, Assam, Northeast, Haryana, Himachal Pradesh and Jammu & Kashmir.
Reliance Communications will gain access to Reliance Jio's 4G network in the 10 circles at virtually zero incremental capex costs.
The Indian government, which has been considering mobile operator spectrum sharing spectrum sharing since at least 2013, has decided to allow it. The new rules allow two carriers in one service area, where both the licensees have airwaves in the same band 2G, 3G or 4G, to combine resources.
That move improves efficiency in a few ways. Most importantly, a service provider with lots of customers but little spectrum will gain capacity. Presumably, the carrier allowing such use will be compensated for the use of licensed capacity.
But the new rules do not allow leasing of specrum by one license holder to another. Also, the move could affect spectrum needs in various areas, and therefore affect spectrum auction behavior.
Under the new rules, sharing of spectrum acquired outside of an auction with spectrum acquired at auction is not permitted. The exceptions are cases where licensees pay the market price for sharing capacity obtained without auction.
Spectrum sharing, in a traditional sense, has been common for Wi-Fi and license-exempt spectrum users. More recently, new forms have been proposed, including sharing by licensed and license-exempt users, as well as sharing of mobile spectrum by mobile providers, in much the same way that tower infrastructure often is shared.
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