In a development that could bring peace to the turbulent telecom sector, the government on Thursday decided to allocate spectrum to existing GSM players such as Idea Cellular [Get Quote] and also to rival CDMA player Reliance Communications [Get Quote] for launching mobile services.

The new entrants, on the basis of eligibility and the priority of application, would be considered thereafter, according to a direction given by Communications Minister A Raja to his ministry officials.

Among existing GSM players, Airtel, Idea Cellular and Vodafone-Essar would be getting the start-up frequency of 4.4 MHz for some circles, at the existing price based on Rs 1,651 crore (Rs 16.51 billion) for nationwide spectrum.

These companies have been waiting for spectrum to start GSM mobile services in some of the circles to cover the remaining areas in the country.

Besides them, Anil Ambani-led RCom that currently offers CDMA-based services, would also get GSM spectrum under the government's decision of October 19 last year to allow companies to launch operations with both the technologies.

The GSM operators have challenged the dual technology decision in telecom tribunal TDSAT and also in Delhi High Court but haven't been able to get a reprieve.

With the entry of new players in the mobile sector, the Department of Telecom expects mobile tariffs to fall by about 50 per cent. But spectrum availability remains an issue.

The defence forces are expected to release 25-30 Mhz of spectrum. Apart from this, the DoT already has 20 Mhz of airwaves. With this, at least 5-6 new players can be accommodated in the industry after given additional spectrum to existing GSM players and CDMA operators such as RCom and Tata Teleservices [Get Quote].

Some of the existing players such as Airtel, Idea and Vodafone have been waiting for additional spectrum since 2006, to expand their services to the remaining areas of the country.