Unified telco licensing, free roaming norms in July

New Delhi: Now that the timeline for spectrum pricing and auction is more or less set, the Department of Telecom has begun work on expediting guidelines for the issue of Unified Licences (ULs) for telcos.

Telecom Secretary R Chandrashekhar told Firstpost that guidelines for unified licences should be ready by July. And thereafter, free national roaming would also be activated after consultations with stakeholders.

[caption id=“attachment_331207” align=“alignleft” width=“380” caption=“Once UL guidelines are finalised, any telecom company can apply for licences even without owning spectrum and can provide services that do not rely on paid spectrum. Reuters”]  [/caption]

Last week, the Union Cabinet approved the New Telecom Policy 2012 which envisages ULs and talks of free national roaming, etc, but no timeframe had been given for the migration of existing licensees to the UL regime till now. Chandrashekhar said that the Telecom Regulatory Authority of India’s (Trai’s) recommendations on ULs are yet to be considered by an internal committee of the DoT and will thereafter be examined by the Telecom Commission.

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“Actual guidelines will be a couple of months away, but they should be out by July. We are trying to speed things up since ULs are very much linked to the August deadline set by the Supreme Court for fresh 2G spectrum auctions,” he said.

On free national roaming, he said different service areas determine the roaming charges at present. “Once UL guidelines are there, then details of making national roaming free will also be worked out”.

The secretary denied that telcos would face any significant revenue loss on account of freeing up roaming facilities. On an average, 7-8 percent of their revenues come from roaming charges. “Telcos’ views were taken into account when the NTP was being drafted. It is incorrect to say that by freeing up roaming, telcos will lose. We must factor in increased efficiencies due to spectrum liberalisation and sharing which will be allowed under NTP. Also, growth will increase for telecom companies….. we are offering a total package so where is the question of revenue loss?”

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At present, when a telecom company bags a licence, spectrum or airwaves come bundled with it. In April this year, Trai had issued guidelines for ULs saying spectrum should be delinked from licences for future auctions. This will not only liberalise the telecom sector, but telcos will need lower investments to enter this business in some cases. Also, a national level Unified licensee can offer multifarious telecom services whereas the scope of present licensee categories is limited.

In its recommendations, Trai has proposed three levels of ULs - National level, Service area level and District level. Not only will all future licences be unified, the framing of guidelines for ULs is critical for those companies who lost their licences after the SC order in February this year.

Once UL guidelines are finalised, any telecom company can apply for licences even without owning spectrum and can provide services that do not rely on paid spectrum.

The new licences do not restrict the kind of service to be provided under UL, except in cases of existing companies whose services are restricted even though they too will be migrated to ULs. Once the new UL regime comes into force, all the existing telecom licences will stand automatically converted to the Unified Licence but they will be fall under Unified Licence (restricted) category.

Trai further recommended that on conversion, the validity of the Unified Licence (restricted) shall be the same as the validity of existing licences and the conditions of these licences will be the same as the existing licence.