India has proposed a licensing approach for assigning spectrum to satellite internet companies instead of having them bid at auctions. This is a major win for SpaceX’s Starlink which has lobbied against auctions that would raise costs.
However, it deals a blow to Indian telecom giant Reliance Jio, run by billionaire Mukesh Ambani, which had argued for auctions to ensure a level playing field.
The proposal was included in India’s new draft telecom bill for the telecommunications sector, seeking to replace the 138-year old Indian Telegraph Act governing the sector.
Starlink and rivals such as Amazon’s Project Kuiper have demanded a licensing approach, concerned that India auctioning spectrum unlike other countries could prompt more nations to follow suit, increasing investments needed.
Reliance Jio, India’s largest telecom operator, disagreed and told the government that foreign satellite internet providers should bid at auction for spectrum just like 5G licensees. That would prevent unfair competition with traditional telecoms.
However, the draft bill sides with Starlink’s demand for licensing, seen as more efficient to speed up satellite internet deployment. India’s satellite broadband market is forecast to grow 36% annually to reach $1.9 billion by 2030, according to Deloitte.
The 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. This could allow blocking Chinese equipment amid ongoing India-China geopolitical tensions.
The licensing versus auctioning approach for satellite internet remains controversial. Reliance Jio will likely continue arguing auctions are fairer. But the draft bill marks an early victory for Starlink in shaping a more favorable regulatory environment in the fast-growing Indian market.
“By bypassing traditional auctions, this pragmatic method is poised to expedite the deployment of satellite services more efficiently,” said Anil Prakash, director general at SatCom Industry Association, a non-profit organization representing the interests of the space industry in India. Its members include satellite operators, manufacturers, suppliers, startups, academic institutions, and law firms.
