India has proposed a licensing approach to assigning spectrum for satellite internet services and exempt companies from having to bid for it, a win for Elon Musk's venture Starlink which has lobbied hard against any auctions.
The proposal was included in a new draft bill for the
telecommunications sector, which seeks to replace the 138-year old Indian
Telegraph Act that currently governs the sector. The bill was tabled for
approval in parliament on Monday.
While Starlink and its global peers like Amazon's Project
Kuiper, and the British government-backed OneWeb would rejoice in the move, it
is a setback to Mukesh Ambani, Asia's wealthiest, who runs Indian telecom giant
Reliance Jio.
The foreign firms have been demanding a licensing approach,
concerned that an auction by India unlike elsewhere will raise the likelihood
of other nations following suit, increasing costs and investments, Reuters had
reported in June.
Reliance Jio, country's biggest telecom operator, however
had disagreed and told government that an auction is the right approach,
similar to 5G spectrum distribution in India. Foreign satellite service
providers could offer voice and data services and compete with traditional
telecom players, and so there must be an auction to achieve a level playing
field, Reliance had argued.
"By bypassing traditional auctions, this pragmatic
method is poised to expedite the deployment of satellite services more
efficiently," said Anil Prakash, Director General at SIA-India, a
satellite industry body.
India's satellite broadband service market is expected to
grow 36% a year to reach $1.9 billion by 2030, according to Deloitte.
Monday's draft telecom bill also empowers India's government
to suspend or prohibit use of telecom equipment from specific countries on the
grounds of national security.