The Hindu : Reliance becomes full-fledged cell operator

Online edition of India's National Newspaper
Thursday, Nov 13, 2003

Business

Business

Reliance becomes full-fledged cell operator

By Our Special Correspondent

NEW DELHI, NOV. 12. Reliance Infocomm was the first off the blocks in taking advantage of the new unified licence regime ushered in by the Government even as cellular companies continued to protest the move. Reliance today paid Rs. 1,542 crores to the Central Exchequer to become a full-fledged cellular operator in most parts of the country a day after the Government paved the way for combining basic and cellular licences.

The Government has moved with unprecedented speed on the issue. The Telecom Regulatory Authority of India (TRAI) issued the recommendations for a unified licence on October 27. The Group of Ministers on Telecom vetted the report on October 30. The Union Cabinet gave its approval the next day and the Department of Telecommunications (DoT) released the detailed guidelines on November 11. Less than 24 hours later, barring a few formalities, Reliance has qualified as a full fledged all India cellular operator.

However, the Government did not address the TRAI's recommendations on ending the licence raj in the telecom sector. Official sources said they were evaluating the TRAI's recommendations in this regard and it may be addressed in the next phase of unification when licences of all telecom services would be clubbed.

Reliance Infocomm has paid Rs. 1,042 crores as entry fee and about Rs. 500 crores as penalty for violating limited mobility (WLL-M) licence conditions. The company was reported to have used ingenuous methods to side-step limitations posed by WLL-M licence conditions and began offering cellular-type roaming. The company has chosen not to opt for unification in the West Bengal circle.

"This will enable over 50 lakh Reliance India Mobile subscribers across the country to continue their existing services seamlessly and enable Reliance Infocomm to provide them new enhanced services as a result of the unified access regime,'' said a Reliance news release.

However, the cellular industry has complained that the DoT's guidelines issued on Tuesday amended the National Telecom Policy `99 (NTP `99). But it believes that once migration was offered to and accepted by the cellular operators in August 1999, NTP-99 became part and parcel of the contracts of cellular companies and conferred enforceable rights upon them. Further, the clause in the guidelines, stating that existing operators will have the option of migrating to a new regime or continuing under the old regime is rather meaningless since it gives no choice at all as cellular operators continuing under the old service-specific licensing regime will have to face unequal competition from FSPs who will migrate to a unified fixed plus mobile regime.

Cellular companies also said the entry fee principles embodied in the guidelines had missed out certain aspects regarding equitable treatment of various types of mobile players, which could affect the orderly growth and development of the sector. The guidelines do not indicate the procedure that will be adopted by the Government for allocation of spectrum, which as per international norms, should be allocated in a fair, objective, transparent, objective and non-discriminatory manner.

The cellular industry is already in appeal before the Supreme Court for a judicial determination of its contractual, constitutional, statutory, legal and other rights under their licences.

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