DoT tightens network roll-out obligations for new firms

DoT tightens network roll-out obligations for new firms
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First Published: Thu, Jan 08 2009. 09 49 PM IST
Updated: Thu, Jan 08 2009. 09 49 PM IST
New Delhi: A department of telecommunications, or DoT, committee tasked to review the network roll-out obligations of new mobile phone service firms has recommended that coverage criteria in licensed areas covering large metropolitan cities be implemented in one year instead of the earlier mandated three years as the areas comprise just one district.
Roll-out obligations mandate the speed at which mobile phone firms need to expand their networks to specific portions of their licensed area when they are allocated spectrum.
The earlier obligations said phone firms have to cover up to 50% of all district headquarters in the licensed area within three years, a target that will now be set for the end of the first year, a senior DoT official, who did not want to be identified, said.
Mobile phone service firms were earlier required to cover at least 10% of district headquarters in licensed areas within the first year of receiving the licence. This benchmark will remain for non-metro licences, the DoT official said, adding that the decision was taken early in December.
The revised norms will apply on new telecom licensees such as Swan Telecom Ltd, Unitech Wireless Ltd, Loop Telecom Ltd, Datacom Solutions Pvt. Ltd, among others. These firms were allocated spectrum to start services in April and have to meet their roll-out obligations by the same month this year. If they fail to meet the obligation, DoT can impose penalties and even withdraw their licence but the government has never done this despite phone firms repeatedly missing such deadlines.
Other changes that the DoT made to the roll-out norms include a decision that licensees who are not able to complete their roll-out obligations will not be eligible for participation in any spectrum auction.
The DoT committee was set up after a March meeting last year with industry representatives, where DoT officials noted that practically all the operators had defaulted on their roll-out obligations.
An executive at a phone firm that is rolling out a country-wide network said the changes in roll-out obligations were not fair since the earlier crop of mobile phone service providers had enjoyed a more relaxed deadline.
“If the government does this, then the new players would most probably take the DoT to court. Everyone wants a level playing field and based on this, the move of the government to bring down the roll-out obligations is unfair as it did not apply to the earlier operators,” the regulator affairs executive said, asking he and his firm not be named.
But a regulatory expert said he saw little impact of the decision. “It’s a post facto attempt to fix something that should have been looked into a long time ago. It makes it slightly more difficult for the new operators to sell out,” Mahesh Uppal, director with Com First (India) Ltd, said. “In a metro, given that active and passive infrastructure sharing is allowed, the operators would have no problem in signing deals with infrastructure firms for their networks to speed roll-out.”
Queries sent to press relations representatives of Swan Telecom and Unitech Wireless for comment on Thursday afternoon remained unanswered despite Mint being told it will have responses by evening.
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First Published: Thu, Jan 08 2009. 09 49 PM IST