Over five months after the country?s telecom regulator recommended cancellation of 69 licences for failure to launch mobile services, the department of telecom (DoT) has sent out only eight notices, pointing instead to the definition of coverage in licence conditions.
Close on the heels of the comptroller and auditor general?s (CAG) report on November 16, 2010, which found 85 telecom licencees ineligible, the Telecom Regulatory Authority of India (Trai) on November 22, 2010, had recommended cancelling 69 of these licences for defaulting on network rollout obligations. All these licences form part of a bunch of 122 licences handed out by former telecom minister A Raja in 2008.
So far, DoT has sent only eight show cause notices and plans to send nine more, adding up to a total of only 17. Every licensee gets 60 days to respond, only after which DoT can take any punitive action. If DoT had swiftly sent out notices following the Trai recommendation, it would have been in a position by now to take a final call on the fate of the licencees.
Why the delay, and why just 17 notices? Responds R Chandrasekhar, secretary, DoT: ?While the licence condition requires that 50% of district headquarters should be covered within 52 weeks from the effective date, it doesn?t specify how to measure the 50%. Should it be in terms of the population or in terms of the number of base transceiver stations (BTS)? Also, is one BTS station enough or should there be 10 stations to count it in the network coverage??
Trai had recommended that 34 licences should be terminated as there was no rollout. These included Etisalat (2) Loop Telecom (14) Sistema Shyam (10) and Uninor (8). Some telecom operators have attempted to fulfill their obligations by setting up skeletal networks, which technically qualify them, though they do not have any subscribers. In this category, Trai recommended 33 licences be cancelled, including Etisalat (13), Loop Telecom (5), Datacom now Videocon (10), Sistema Shyam (1) and Aircel (4) since the rollout was just on paper.
The CAG had made adverse comments on rollout defaults and charged DoT with failing to recover R679-crore penalties. Trai too was clear that technical rollouts do not count as mobile services launch, but Chandrasekhar doesn?t sound convinced: ?The licence doesn?t talk of substantial coverage area. It strictly says that at least 10% of the area should be covered in the first year and 50% within three years from the effective date. So now, the question is whether that has been done. If someone has put up towers and started radiating in a town, then how can that be breach of licence conditions??
The licence conditions mandate licensees to cover at least 10% of the district headquarters by the end of the first year of being given the spectrum and 50% by the end of third year. The DoT can impose a fine of R5 lakh a week for the first 13 weeks of delay, R10 lakh for the next 13 weeks and thereafter at the rate of R20 lakh for delay up to 26 weeks. If any operator fails to fulfill the obligation even after 52 weeks , then DoT has the power to cancel the licence.
