No auction of satellite spectrum, says govt amid Musk-Ambani tussle

Satellite spectrum allocation row: The Indian government announced on Tuesday that it will allocate satellite broadband spectrum administratively rather than through auction. This decision follows criticism from Elon Musk, who described the auction approach sought by rival billionaire Mukesh Ambani as "unprecedented."

The allocation methodology for satellite spectrum in India has become a contentious issue, particularly as the market is projected to grow by 36 per cent annually, reaching $1.9 billion by 2030. Musk's company, Starlink, argues that administrative allocation aligns with global trends, while Ambani's Reliance insists that an auction is necessary to ensure a fair competitive landscape, given the absence of clear legal provisions for satellite broadband services in India.

Telecoms Minister Jyotiraditya Scindia stated at an event in New Delhi that the spectrum allocation will adhere to Indian laws, with pricing determined by the telecom regulator. "If you do decide to auction it, then you will be doing something which is different from the rest of the world," Scindia remarked.

The statement follows a Reuters report indicating that Reliance had contested the Indian telecom regulator's process, which appears to favor administrative allocation over auctioning. Ambani's firm has called for a reevaluation of the consultation process.

Musk, responding to the Reuters story, reiterated his stance on X, stating that an auction would be "unprecedented." He highlighted that the International Telecommunication Union (ITU) has long designated the spectrum as shared for satellite use, emphasizing that India, as a member, should allocate this limited resource efficiently and rationally.

Supporting the auction approach, Sunil Mittal, co-chair of global satellite group Eutelsat and chairman of Bharti Airtel, asserted that satellite companies looking to serve urban markets should acquire telecom licenses and purchase spectrum like other telecom operators. Earlier in 2023, both Eutelsat's OneWeb and Airtel expressed concerns about the implications of auctioning the spectrum in submissions to the Indian government.

Musk's Starlink and other global competitors, such as Amazon 's Project Kuiper, advocate for administrative allocation, arguing that spectrum should be regarded as a shared natural resource among companies. The ongoing dispute between Musk and Ambani highlights the evolving dynamics in India's burgeoning satellite broadband market.

(With Reuters inputs.)