State-owned MTNL has asked the government to extend the validity of its mobile license for the lucrative circles of Delhi and Mumbai by two more years till 2021, at no extra cost.
State-owned MTNL has asked the government to extend the validity of its mobile license for the lucrative circles of Delhi and Mumbai by two more years till 2021, at no extra cost. The telecom PSU has argued that its mobile license for the two service areas remained underused in the first four years of the permit’s lifespan, for various reasons. The cellular license of Mahanagar Telephone Nigam Ltd (MTNL) is valid until April 2019, after which the debt-laden corporation would be required to renew it. The reasons cited by the company for seeking an extension includes the late start of services owing to a litigation, and spectrum allotted nearly 2.5 years after the grant of a licence, according to a recent letter written by MTNL Chairman P K Purwar to the Telecom Department. MTNL has also said that the geographical coverage of its mobile license initially was not at par with the private telecom operators. As per data by the telecom regulator, MTNL’s wireless subscriber base stands at over 36 lakh in the two metros put together.
A household telephony brand in the 90s and early 2000, MTNL’s revenue and profitability has come under tremendous pressure with intensified competition in mobile and landline telephony services. Its latest request to Telecom Department comes at a time when the entire telecom industry is reeling under financial stress, and an inter-ministerial group has been constituted to suggest remedial measures ease the difficulties faced by the sector. “In case of Delhi and Mumbai service areas, the expiry date of the CMTS (cellular) licence along with administratively allotted spectrum may …be modified on January 10, 2021, that is 20 years from effective date of granting standard licence in terms of geographical coverage at par with the other telecom service providers to maintain a level playing field,” MTNL has said. MTNL has contended that in the beginning, its license was a “nonstandard” one and the area of operation was restricted to Delhi Municipal Corporation and Mumbai Municipal Corporation.
The license was brought at par with other private operators when it was allowed to extend the coverage to Delhi NCR areas of Ghaziabad, Faridabad, Noida, and Gurgaon and in Navi Mumbai and Kalyan areas of Mumbai in 2001, it pointed out. “…settlement of litigation pertaining to grant of licence by DoT took appreciable time, allotment of required spectrum was made after 2.5 years from the grant of licence and parity in terms of geographical coverage with regard to other telecom service providers was given to MTNL on January 11, 2001…the standard terms and conditions of license should not be made applicable earlier than January 11, 2001,” MTNL has said.