Unlike mobile services, radio trunking has been caught in the dragnet of government policies. The current wireless planning and coordination (WPC) charges, which include the royalty for spectrum plus license fee, come to around Rs 300 per subscriber. TRAI has fixed the total royalty and the license fees to be paid to the DoT at five percent of the adjusted gross revenue. The operators say though the fee was reduced from almost eight percent to the current levels, yet it is still high when it comes to per user cost. As the burden is passed on to the customer, per unit cost comes to around Rs 900. The government is still not clear on allowing PSTN connectivity on radio trunking services, the operators are losing out to mobile and basic operators.

Also, though the DoT guidelines mentioned that PMRTS licensees should use only digital technology, TRAI has recommended that the choice of technology should be left to service providers. Today, most of the operators have analog infrastructure in place and shifting to digital mode would require more investments. Considering the industry’s health, analog operators are not willing to invest more unless all-India connectivity and roaming are allowed. This will give them a competitive edge over other mobile services. Also, the number planning issue is preventing digital technology from taking off.

Source: VOICE&DATA Goldbook 2004