TRAI urges govt to quash licences of spectrum hoarders

Two days after the office of the comptroller and auditor general (CAG) raised an alarm over what it called hoarding of spectrum by new telecom operators, the telecom regulator has sent its recommendation for the cancellation of 62 of the 122 licences issued by former minister A Raja.

"We know that 34 licensees had not rolled out their networks while the remaining 28 licensees had rolled out but failed to meet the criteria laid out in the licence," said an official of the Telecom Regulatory Authority of India (TRAI) on condition of anonymity.

Loop Telecom, in which the Essar Group has a stake, may be the biggest loser — standing to lose 19 of the 22 circles, followed by Etisalat-DB (formerly Swan Telecom) with 15 circles and Shyam-Sistema (MTS) and Videocon with 10 circles each.

Uninor, the fastest growing telecom firm in the country with commercial operations in 13 out of its 21 circles, also stands to lose all its remaining eight circles if the TRAI recommendation is implemented.

The TRAI scrutiny, however, did not find any lacunae in the roll-out by the Anil Ambani Group and the Tata Group, which together got spectrum allocation for around 35 licence areas at the same time.

The regulator’s recommendation, which is subject to government approval, came after a stinging indictment of the government by the CAG for standing by and watching as companies squatted on spectrum allotted to them in February 2008.

According to licence conditions, companies had to cover at least 10% of the district headquarters within a year and 50% by the end of the third year in non-metro licence areas and 90% in metro areas.

But as reported by DNA on Thursday, Uninor, MTS and Videocon have launched commercial services in some of their licence areas, while Etisalat-DB and Swan are yet to commercially launch in all or nearly all of their circles.

All the firms claimed that they were not in violation of licence conditions. "Loop Telecom is in compliance with the roll-out obligations as per the UAS licence," the company said in an e-mailed statement while refusing to comment on the specifics. Similar statements were issued by both Uninor and MTS.

A Press Trust of India report said the new communications and IT minister Kapil Sibal called a meeting of top officials of his ministry in which the regulator's recommendations were also discussed.

"Sources indicated that Sibal could execute a major shake-up in the ministry in the aftermath of the CAG report. Some officials are also believed to be under watch and their decisions are being examined," the agency said.

Meanwhile, Sunil Mittal, who heads India's largest telecom firm Bharti Airtel, urged the government to keep the growth of the sector as its priority while framing policy but refused to comment on whether the licences of erring operators should be quashed.

"We have been through all sorts of policy changes... sometimes good, sometimes bad, sometimes really bad.... It is an extremely capital intensive industry... the policy that the government adopts should encourage the growth of the sector," he said, when asked about the 'new regime' that had taken over at Sanchar Bhawan, headquarters of the department of telecommunications.