3G roaming arrangements of telcos leave DoT in a bind

3G roaming arrangements of telcos leave DoT in a bind

New Delhi: The Department of Telecommunications (DoT) is in a quandary over how to deal with the third-generation (3G) roaming arrangements among Bharti Airtel Ltd, Vodafone Essar Ltd and Idea Cellular Ltd— India’s top three telcos.

DoT is of the view that the agreements should be deemed illegal; at the same time, it is looking at legalising spectrum sharing by January, enabling such arrangements between telcos. Spectrum sharing would allow a licensed operator in a telecom zone to lease the airwaves to a company that doesn’t have spectrum in the same area.

“How can we ask them to pay the Rs50 crore penalty and deem the arrangements illegal and then allow them the very next month," a senior DoT official said, requesting anonymity. “We may ask them to change the agreements... so they can adhere to the new rules and may ask them to pay a penalty but it will be difficult to declare the agreements illegal."

Over the last three weeks, at least three DoT divisions— Licensing Finance (LF), Wireless Planning and Coordination and Access Services—as well as the Telecom Regulatory Authority of India (Trai) have recommended to DoT that the agreements be declared illegal. The law ministry has said the same.

“The proper process has been followed with all the relevant divisions of the DoT giving their opinion and even the Trai has given its recommendations. It is difficult to not go ahead with the penalty notices at this point," a second DoT official said.

The officials, however, were unable to give any precise estimates on the loss of revenue to the government due to these arrangements and how the loss would be dealt with. The telcos implemented the arrangements in July this year.

“There has been a significant loss to the government in terms of money from spectrum usage and such things," the second official said.

Communication minister Kapil Sibal is likely to meet telcos’ representatives to discuss the issue. The communications ministry is likely to seek the opinion of the Prime Minister’s Office and the Cabinet secretariat on how to tackle the issue.

The chiefs of the three companies—in a jointly signed letter—have sought the Prime Minister’s intervention in the dispute over the 3G roaming pact, threatening to surrender spectrum if the roaming arrangements are deemed illegal.

The company says they have followed the rules. The letter said that during the spectrum auction process a clarification had been issued intimating that operators who don’t win 3G spectrum in a service area can offer their customers 3G-based services on the network of an operator who has won spectrum.

“It ensures optimal usage of the spectrum. No operator would sacrifice quality of service to their customer and these are purely commercial arrangements," a senior official with one of the telcos said on condition of anonymity. “Once the spectrum starts getting saturated, the operator will obviously... exit from the arrangements and force the operator who did not win spectrum to find other means to service their subscribers. This is a temporary arrangement till such time more spectrum becomes available."