India has proposed a licensing strategy to assign spectrum for satellite internet services that would spare corporations from having to bid for it, a victory for Elon Musk's Starlink company, which has campaigned hard against any auctions.
The suggestion was included in a new draft bill for the telecoms industry, which seeks to replace the sector's current 138-year-old Indian Telegraph Act. On Monday, the bill was introduced before parliament for approval.
While Starlink and its global peers such as Amazon's Project Kuiper and the British government-backed OneWeb would applaud the action, it is a defeat for Mukesh Ambani, Asia's wealthiest man and the CEO of Indian telecom giant Reliance Jio.
Foreign corporations have demanded a licensing strategy, fearing that an auction by India, unlike elsewhere, will increase the chances of other countries following suit, increasing costs and investments, according to Reuters in June.
However, Reliance Jio, the country's largest telecom provider, disagrees, telling the government that an auction, similar to 5G spectrum distribution in India, is the best way. Foreign satellite service providers may compete with existing telecom firms by offering voice and data services, hence an auction was required, Reliance said.
"By bypassing traditional auctions, this pragmatic method is poised to expedite the deployment of satellite services more efficiently," said Anil Prakash, Director General of the Satellite Industry Association of India.
According to Deloitte, India's satellite broadband service industry will rise 36% per year to $1.9 billion by 2030. The draft telecom bill released on Monday also gives the Indian government the authority to ban or prohibit the use of telecom equipment from specified countries for reasons of national security.