In a direct attack on the Tatas, the Cellular Operators' Association of India, the apex body for GSM operators, has shot off a letter to Communications Minister Dayanidhi Maran saying that the Tata submission does not reflect an adequate understanding of the ground realities of spectrum availability and seeks "only to meet their limited vested interests".
Hinting at the Tatas clearly, the letter, written by COAI Director-General TV Ramachandran says, "A player who is performing less and does not have the subscriber base cannot seek unjustified reservation of this precious resource at the expense of an operator who is performing and needs that spectrum to fuel his further growth".
The Tatas had written to Maran a few weeks ago suggesting that spectrum for 2G telecom services should be priced in line with the Telecom Regulatory Authority of India's (Trai's) policy to auction spectrum for 3G services and the scarce resource should be given upfront instead of in small chunks.
Second-generation (2G) services are those that are now offered by mobile telephony companies, while 3G (third-generation) services will provide high-speed Internet access.
Tata Teleservices has shot back in response to the letter, saying that CDMA operators have grown at a compound annual growth rate of 200 per cent since they launched services in 2003, compared with 70 per cent by GSM service providers and, therefore, "the issue of performance is really a red herring."
A Tata Teleservices spokesperson also observed that with Trai having clearly established the need to price spectrum, it would now be difficult to wish this away.
The spokesperson also argued that its suggestions "underlines the opportunity opened up by Trai's forward-looking recommendations on 3G services, to make progress towards a comprehensive spectrum policy".
The COAI letter said, "Tata Teleservices' proposal, however, wants the spectrum to be allotted without performance. It also wants the lower performing players to be unfairly and unjustly enriched at the expense of performing players."
It adds that it seeks to tilt the playing field against performing players. And "it seeks to replace performance with 'deep-pockets,'" as the criterion for spectrum allocation.
There was no need for pricing principles, which had worked for several years, to be changed now, Ramachandran added.