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How does owning spectrum help us?

posted by Ray_Titus on Monday, February 6th, 2012

I hope amidst all the license cancellation din in India, the real issue isn't swept under the carpet, or misunderstood.

The honourable Supreme court may have cancelled licenses, but don't for a moment assume the business scene will get better if regulations are 'tightened' to ensure fairplay. Regulations and their stern application isn't the answer to business fair play. Instead its the opposite that works. Do away with regulations (read, licenses). Let the market do its job in deciding who gets in, stays, or goes.

Saying spectrum belongs to the people of India and the state is the trustee sounds mushily appealing. But what licensing 'people-owned' spectrum really does is raise costs for those who want to get into the business of telecom services. Such increased costs will see license buyers legitimately pass it on as higher service prices to consumers.

So where is the tom-tommed benefit to people in being spectrum owners if they have to pay higher prices? Sure, government kitties will swell through licensing, but don't tell me you are willing to bet such money will be used for social upliftment.

Fat chance.

The best thing a government can do is to stay out of the business of business, making it easy for private parties to do business. Private parties doing business under market driven competition conditions is what will really benefit the citizenry.

Here's hoping people understand that.

Prof. Ray Titus

posted by Ray_Titus on Monday, February 6th, 2012

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