The Telecom Regulatory Authority of India (Trai) may ask the government to either impose penalties or cancel the licences of nine telecom operators that were granted licences in January 2008, according to Trai’s chairman cited in the Financial…
The Telecom Regulatory Authority of India (Trai) may ask the government to either impose penalties or cancel the licences of nine telecom operators that were granted licences in January 2008, according to Trai’s chairman cited in the Financial Express.
Trai reportedly argues that the companies did not meet their rollout obligations, which include covering at least 10% of the district headquarters by the end of the first year of receiving licences. India has a total of 626 districts split into 28 states and seven union territories.
According to the local newspaper, as of January 2010, only two companies had launched operations – Uninor in eight circles and S Tel in three circles. But Loop Telecom, Videocon Telecommunications and Etisalat DB reportedly also claimed to have made launches after January 2010.
Trai is expected to submit its recommendations to the Department of Telecommunications (DoT), which will then decide which action to take. But the Trai’s recommendations will likely go against an earlier proposal by the DoT to allow the new telcos to sell their licences and airwaves.
Back in August, reports quoted a DoT official saying that these telcos wanted to exit their licences and spectrum in select service areas because of constraints in launching mobile operations across India’s 22 circles.
The exit options considered included allowing new entrants to merge with larger companies, therefore shortening the three-year period during which a founder of a telco cannot sell out, and relaxing rules to allow incumbents to retain bandwidth held by these new companies in case of a buyout or a merger.
Such a move could help thin out India’s crowded mobile phone market, currently populated by 14 operators, many of them foreign-owned.
Trai did not respond to requests for comments before going to press.
