In yet another key telecom reform, the government would end the multiple licence regime and converge all permits under a single licence, christened unified service licence (USL).
In the future, a USL would enable players to give all forms of telecom services such as long distance and Internet services as well as mobile and landline services. Currently, such services come under multiple licences. While mobile, landline and Internet services can be provided under a unified access service licence (UASL), a separate licence is required for long distance services. Stand-alone ISPs have a separate licence regime.
However, while merging all the licences, the government would raise the pan-India USL fee from the current levels. A UASL licence now costs Rs 1,651 crore. If operators are interested in providing services in phases, they will have to pay an initial registration fee and pay the balance when they go in for other forms of services.
Operators now having separate licences for giving different services may be given a time-frame to migrate to the USL. Officials at the department of telecommunications (DoT) said a proposal to this effect is under processing. While taking this step, DoT has taken a leaf out of the Telecom Regulatory Authority of India?s (Trai) book. When UASL was conceived in 2004, the then Trai chairman, Pradip Baijal, had recommended that in the next step there should be a single licence for providing all kinds of telecom services to be called USL. But the government never went ahead with the suggestion.
Prior to UASL, there were separate licences for cellular and basic services.
At present, for national and international long distance licence, telecom companies have to seek a separate licence by paying Rs 2.5 crore. Among the major pan-India telecom players, only Bharat Sanchar Nigam Ltd (BSNL), Bharti Airtel, Reliance Communications Ltd and Tata Communications have NLD and ILD licence. Companies like Vodafone Essar, Idea Cellular and Aircel do not have long distance licences. Similarly, foreign players like AT&T, BT, Verizon and France Telecom have NLD and ILD licences.
The reason for DoT taking up this proposal at this stage is the recent Trai recommendation to permit Internet telephony calls between personal computers and telephones. While making this suggestion, Trai has not supported levy of a licence fee on the ISPs, something that is contested by telecom service providers. The thinking in DoT is that if PC-to-phone calls are allowed, the government would lose out on revenue, as there would be no takers for NLD/ILD licences.
This is because while ISPs providing only Internet services pay a token licence fee of Re 1, those who provide Internet telephony do not pay any entry fee but pay 6% of their adjusted gross revenue (AGR) as revenue share licence fee to the government. ?Not levying any entry licence fee on ISPs providing Internet telephony would kill the NLD/ILD sector and there may not be any takers for these licences. The government would also lose by way of revenue?, said a DoT official.
While formulating USL, DoT would also take a final view on the need of de-linking start-up spectrum from the licence fee, which is bundled at present.
