Jio, Airtel vs Starlink: Telcos warn of business impact if satellite spectrum is priced low

Leading Indian telecom companies, Reliance Jio and Bharti Airtel, have expressed serious apprehensions regarding the proposed pricing framework for satellite spectrum in the country. They argue that if the spectrum is priced too low, it could jeopardize their business interests while giving an unfair advantage to satellite internet providers, such as Elon Musk’s Starlink. A report from Reuters reveals that the Cellular Operators Association of India (COAI), which represents key players in the telecom sector, has reached out to the telecom ministry, requesting a reassessment of the proposed pricing strategies. The association points out that conventional telecom operators incur significantly higher costs for spectrum, primarily through auctions, in stark contrast to the lower administrative fees suggested for satellite companies. The telecom regulator in India has proposed that satellite firms pay 4% of their annual revenues to the government, a strategy reportedly advocated by Starlink, reflecting a global trend of considering spectrum as a shared resource rather than auctioning it off. The COAI highlighted the need for equitable pricing, stating, "Price per MHz should be equivalent or at least comparable for both, especially when used to reach the same consumers for identical services." They also warned that satellite internet could emerge as a competitive alternative to traditional broadband. Neither Reliance Jio nor Airtel responded to requests for comments, and Starlink was unavailable for immediate feedback. A senior government official indicated that the telecom ministry is actively reviewing the regulator's recommendations, noting that feedback from the industry is a common occurrence. Sources close to the matter revealed that companies like Reliance Jio are particularly wary of the financial disparities, especially as they continue to invest heavily in similar broadband services while facing much steeper costs. In fact, Reliance and other operators have collectively spent nearly $20 billion (around ₹1.72 lakh crore) in recent years on acquiring 5G spectrum through auctions. Despite these concerns, both Reliance and Airtel have entered into distribution agreements earlier this year to market Starlink equipment, even as they gear up to compete with the service once it launches for consumers. Telecom Minister Jyotiraditya Scindia has stated that the process for Starlink to secure its operating license in India is nearing completion.