There have been furious debates and disputes around the matter of licensing of telecom services. While the Indian Telegraph Act, 1885 gives exclusive privilege to the central government for establishing, maintaining and working telegraphs (telecommunication system), it is important to understand that it also empowers the government to grant a license to any person “on such terms and conditions and in consideration of such payments as it deems fit”, to establish, maintain and work a telegraph within any part of India (Proviso to Section 4(1), Indian Telegraph Act, 1885). Clearly, a wide, all-encompassing power that embraces all possibilities (including ‘no terms’).

Till 1990, Indian telecommunications were the monopoly of the government’s department of telecommunications (DoT). The telecom sector was opened up for private sector participation in the early 1990’s and in the early stages, DoT understandably entered into elaborate license agreements with private players to provide various telecom services, especially full-blown carrier services. Today, however, in the context of burgeoning innovative new generation applications like Messenger, Skype, WhatsApp, FB, etc, and for public-WiFi hotspot services, this policy needs review with a deeper understanding of underlying priorities. Unless understood correctly and dealt with expeditiously by the authorities, harnessing the enormous benefits of the new-gen services and Digital India could well come to nought.

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We need to first establish the precise meaning of the term ‘licence’. Black’s Law Dictionary, one of the most long-standing, reputed and trusted sources worldwide for definitions of legal terms—the veritable gold standard for the legal language, defines a license as “a permission, accorded by a competent authority, conferring the right to do some act which without such authorisation would be illegal, or would be a trespass or a tort”(thelawdictionary.org). Generally, this permission is given in writing as an express license. Under certain circumstances, in place of the express license can be an implied license. An implied license is an unwritten license which permits a party (the licensee) to do something that would normally require the express permission of another party (the licensor). Implied licenses may arise by operation of law from actions by the licensor which lead the licensee to believe that it has the necessary permission. In 2008, the Ninth US Circuit Court held that a non-exclusive license to use copyrighted material can be granted by implied license (www.revolvy.com). In this sense, for today’s world, a ‘virtual license’ could fittingly be a legal reality.

A practical example of the above is that, till recently, possession of any wireless transmitter was in contravention of the provisions of Wireless Telegraphy Act and punishable with imprisonment of three years, a fine of R1,000, or both. However, today, no explicit license is required for the possession and use of a radio, or a TV, or even a mobile handset which is capable of two-way communication (as per section 2A of the wireless Telegraphy Act, ‘wireless transmitter’ means any apparatus, appliance, instrument or material used or capable of use for transmission or omission of wireless communication), as there is an implied permission (licence) to possess and use it. In another illustration, PCO operators, as franchisees of the licensed TSPs, provide telecommunications services to end users. EPABXs are set up in housing societies providing voice and data services to end users under franchise from licensed TSPs like BSNL. The licence to provide services is implicit in these cases.

Can an operator be permitted to provide services through simple registration? As per English Language and Usage Stack Exchange, the words ‘licensing’ and ‘registration’ are linked and sometimes used interchangeably, simply because in order for something to be registered, it often has to be licensed, and vice-versa. Registration can be evidence that something is licensed (www.englishstackexchange.com). This matter was deliberated at length by TDSAT in Reliance Infratel Ltd. versus Etisalat DB Telecom Pvt Ltd, Mumbai (petition no 75 of 2012, order of the Tribunal, April 10, 2012). One of the contentions in the case was that the petitioner, therein, being a registrant could not render telecommunication service not only because it was specifically debarred from doing so but also in view of the fact that it was not a licensee within the meaning of the provisions of Section 4 of the ITA. The Tribunal found in regard to a registrant being a licensee that the parting of the exclusive privilege vested in the central government through a registration certificate or otherwise, implied licensing. “..If, whether by way of grant of registration certificate or otherwise, any part of the exclusive privilege vested in the central government is to be parted with or outsourced in favour of any other entity, the same would mean a license…”(para 125 of the Order). In a somewhat analogous case, the Delhi High Court (Viom Network Ltd and Anr versus S Tel Pvt Ltd [2013-(004)-ARBLR-0551-DEL]) also ruled that registration is another form of licence.

It is arguable whether even full-blown carrier services need detailed licences to define licensee rights such as the scope of allowed services, right to interconnection, etc. The case for detailed licences for next-generation/value-added services that ride over already licensed bearer services provided by TSPs is even less clear. In some cases, a simple online registration may suffice for the purpose record-keeping. Examples of these abound in broadcasting services, which also fall under telecommunications. For example, a Local Cable Operator (LCO), providing last-mile connectivity and service to end users, is only required to register with the postal authorities.

Virtual licensing may well sound blasphemous, but, George Bernard Shaw observed, “All great truths begin as blasphemies”. Nothing legally prevents the government from parting with its exclusive privilege to provide telecommunications services through simple registration. With advancing technology and the proliferation of applications, next-generation and value-added services are rapidly emerging that use the networks/services of existing TSPs at higher layers. These next-gen VAS and applications are invaluable, not only to end-users, but also to all the stakeholders in the value chain and the economy as a whole. Resorting to a rigid explicit licence in such cases would perhaps only negate most benefits. It will, moreover, unnecessarily increase administrative workload and delay service deployment. If we are to realise Digital India, policy must always scrupulously promote innovation and fair competition.

Kuldip Singh is former member, TDSAT and former CMD, MTNL, while TV Ramachandran, is honorary fellow of the IET (London) & president, Broadband India Forum.

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