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The battle for control of India's burgeoning satellite broadband market has intensified, with Reliance Industries, led by billionaire Mukesh Ambani, challenging the telecom regulator's decision to allocate spectrum rather than auction it. This move intensifies the ongoing clash with Elon Musk's SpaceX-owned Starlink, which favors the allocation approach. The stakes are high, with Deloitte predicting the Indian satellite broadband market to grow at a remarkable 36% annually, reaching $1.9 billion by 2030.
The controversy centers around the interpretation of Indian law, which some industry experts argue paved the way for the allocation of spectrum in 2022, a move favored by Starlink. However, Reliance contends that no legal provisions exist specifically for satellite broadband services targeting individual or home users. The Telecom Regulatory Authority of India (TRAI) is currently holding public consultations, but Reliance, in a private letter addressed to the telecoms minister, Jyotiraditya Scindia, on October 10, has demanded a fresh start, arguing that TRAI's decision to favor allocation is premature and lacks proper justification.
Reliance's letter, obtained by Reuters, criticizes TRAI's position, asserting that the watchdog has "pre-emptively interpreted" the law in favor of allocation. Reliance's senior regulatory affairs official, Kapoor Singh Guliani, wrote in the letter, "TRAI seems to have concluded, without any basis, that spectrum assignment should be administrative." The company further argues that TRAI's consultation paper wrongly claims that Indian laws mandate spectrum allocation without conducting any studies. In a statement to Reuters, Reliance Jio emphasizes the need for a level playing field and demands that TRAI amend its consultation paper to include discussions on the methodology of spectrum assignment.
While TRAI officials maintain that due process is being followed and welcome Reliance's feedback, the dispute highlights the tension between traditional telecom players like Reliance Jio and emerging players like Starlink. Reliance, with its dominant position in the Indian telecom market, fears that foreign companies like Starlink could gain an unfair advantage through direct spectrum allocation. This fear stems from the potential for Starlink to offer both voice and data services, directly competing with existing telecom operators. Starlink, on the other hand, advocates for an administrative allocation model, arguing that it aligns with global trends. Ultimately, the government will base its decision on spectrum allocation on the recommendations made by TRAI.
The outcome of this dispute will have significant implications for the future of satellite broadband in India. Reliance's aggressive stance indicates its willingness to defend its market share. The company's success in pushing for an auction process could potentially slow down the entry of Starlink and other international players into the Indian market. Conversely, if TRAI recommends administrative allocation, it could pave the way for a rapid expansion of satellite broadband services in India, challenging the dominance of traditional telecom operators like Reliance Jio.
Source: Ambani's Reliance lobbies India on satellite spectrum in new face-off with Musk