Vodafone challenges government's decision to auction 900MHz spectrum

Vodafone has moved the Delhi High Court on Wednesday against the government’s plan to auction off spectrum in the 900MHz band. The petition has been filed as a challenge against the auction of  the radio waves even as the company’s applications for extension of licences is still pending with the Department of Telecom (DoT)

The company says that the 900MHz is the spectrum that forms the foundation of the network and Vodafone has, over the last 18 years, designed and built its telecommunication networks, infrastructure and operated its services by utilising the above spectrum.

“Vodafone believes that it is entitled to a fair and reasonable extension of its licence as per mutually agreeable terms. Both the policy and licence provide for continuity and this action of DoT to arbitrarily withdraw the 900MHz spectrum is not only against the provisions of policy and licence but also disruptive and against public interest,” the telecom company said in a statement.

More from News & Analysis

What is the US HIRE Bill and why is India’s $250-billion IT sector worried? Is the internet dead? What's this theory that OpenAI's Sam Altman says might be true?

Vodafone has knocked on Delhi HC’s doors (Image credit: Getty Images)

In December 2012, Vodafone had applied for the extension of its licence for the Delhi Mumbai and Kolkata circles that are due to come up for renewal in November 2014. According to clause 4.1 of the Unified Access Service Licences (UASL or telecom licence), the companies are eligible for an extension, on application in year 19, of the licence for 10 years at a time after the first 20 years are concluded.

The government though changed the terms of licences by turning them into “renewal” rather than “extension” as well as delinking spectrum from the licences. Essentially, Vodafone will now have to not only bid but also win spectrum in the auction that is set to happen in March in order to be able to offer services in the metros of Delhi, Mumbai and Kolkata till its licences are up for renewal in November 2014.

A disgruntled Vodafone said that it believes the extension of its licence is expedient and as per the licence, it has to be on terms that are mutually agreed on. “As per Vodafone both the policy and licence provide for continuity and this action of DoT to arbitrarily withdraw the 900MHz spectrum is not only against the provisions of policy and licence but also disruptive and against public interest.”

The company also said that using the spectrum allocated under licence, it is providing services to over 18.7 million subscribers. Stating that it is a “serious and a committed player” in the Indian market, Vodafone said that it has invested thousands of crores in setting up its networks, serving millions of subscribers and contributing to national connectivity objectives. It is also contributing “thousands of crores” to the Government exchequer in the form of licence Fee, spectrum charges, direct and indirect taxes etc.

Earlier today, it was revealed that Sistema Shyam had requested the DoT to grant it a temporary licence so it can continue to operate till the new spectrum auction is held next month. The telecom operator had lost its 2G spectrum licence last year following the Supreme Court’s orders. This news comes even as Uninor downed its shutters in Mumbai on February 16, leaving subscribers in a lurch.