After HCs Bharti order, DoT takes on Voda, Idea

Written by feBureau | New Delhi | Updated: Apr 6 2013, 08:26am hrs
After Bharti Airtel, the department of telecommunications (DoT) on Friday issued notices to two other firms Vodafone and Idea Cellular to immediately stop providing 3G intra-circle roaming services in circles where they do not have spectrum. Vodafone and Idea provide such services in 11 and 6 circles, respectively. Apart from asking the two companies to stop roaming services, the DoT has also slapped a penalty of R550 crore on Vodafone and R300 crore on Idea for violating licence conditions.

The development comes a day after the Delhi High Court set aside its earlier stay order that had allowed Bharti Airtel to continue providing such services till further hearing in the case. Bharti provides such services in seven circles and a fine of R350 crore has been imposed on it. Bharti Airtel on Friday filed a petition in the Supreme Court seeking a stay on the high courts order and the matter would come up for hearing on April 8. Vodafone has already impleaded itself with Bhartis case. Idea officials said that they are contemplating legal steps against the DoTs order.

Interestingly, Idea Cellular had earlier received a stay order from the Delhi HC in a related matter. Idea, which had got fresh licences in seven circles after winning spectrum in November 2012, had moved the HC against the DoTs move of inserting a clause in the licence conditions that it cannot provide 3G intra-circle roaming in these circles. The court had stayed this action of DoTs till further hearing in the matter.

Industry sources said that the 3G intra-circle roaming case has become complicated and seems set for a long-drawn battle. The fight between the mobile operators and the DoT over this issue is an old one in which no clarity emerged since even the Telecom Disputes Settlement and Appellate Tribunal gave a split verdict. The fresh notices are after a DoT committee held that the arrangement between the operators is not one of roaming but actually of a mobile virtual network operator, which is not allowed under the current telecom policy.

Since the high court on Thursday vacated the earlier stay order acting on a plea by Reliance Communications, which pleaded that Bhartis move to provide pan-India 3G data services was impacting its business, elements of a fresh round of corporate war in the controversy-ridden sector is also being seen by some.

Bharti Airtel, Vodafone and Idea won 3G airwaves in 13, 9 and 11 circles, respectively, in the 2010 auctions. They subsequently entered into intra-circle roaming pacts with each other and rode on the airwaves of their partners in regions where they did not hold spectrum themselves. These roaming pacts enabled them to offer high-speed data services on a pan-India basis.

Intra-circle roaming is distinct from inter-circle roaming. Under it, an operator provides 3G services to its customers even in circles where it does not have 3G spectrum by sharing it with the ones that have.

In December 2011, the DoT had declared 3G roaming pacts illegal. The operators claim that they had sought written clarifications from the DoT over the matter before entering into such pacts and that the latters response was in the affirmative.

When DoT asked the three companies to stop such services in December 2011, they moved the TDSAT and got a stay order. In July 2012, the TDSAT issued a split verdict, with the then chairman Justice SB Sinha stating that such pacts were legal while the then member PK Rastogi termed them illegal. It did not help matters that a third member had retired and no substitute was appointed.

Subsequently, in September, the DoT again sent notices to the companies to stop services. The firms moved the Delhi HC and got a stay. The court directed DoT to consider the replies of the companies to the notices and accord them personal hearings in the matter.

Ringing alert

* While Bharti was fined R350 cr, Vodafone & Idea have been fined R550 cr & R300 cr

* Bharti provides 3G intra-circle roaming in 7 circles, Vodafone in 11 & Idea in 6 circles

* DoT alleges that the services are akin to MVNO, which are currently not allowed in India

* The 3G roaming case has become complicated and seems set for a long legal battle