Draft Guidelines for Unified Licensing Regime, issued by TRAI on 16-01-2012

1.      The TRAI has issued draft guidelines on 16^th January on unified licensing regime.

2.       Unified License means a customer can get all types of telecom services, from a Unified License Operator—voice; data; internet telephony; Internet services including IPTV;  broadband services including triple play i.e voice, video and data; NLD( National Long Distance) ; ILD(International Long Distance) ; GMPCS(Global Mobile Customer Service by Satellite);  V SAT (Very Small Aperture Terminal) services; PMRTS; Radio Paging; and voice mail/Audio Tex/ Unified Messaging   Service  through wire or wireless. .All public networks including switched networks irrespective of technology capable of offering these services are covered under this category.

3.      Any company can take the universal service for entire India ( National level) or for one or more than one circles (service area level) or for one or more districts (District level). At present, the license is for circle level only, means if a company has to provide services throughout the country, it has to take separate license for each and every circle.

4.      There will be no restriction on the number of entrants in a license area.

5.      License will be given without any spectrum. Licensee has to separately apply/bid for obtaining spectrum as per the prevailing policy. (At present, 4.4 MHz of 2G spectrum is given along with the license)

6.      The applicant must be an Indian company registered under Indian Companies Act. It can have FDI upto 74%.

7.      The majority of the Directors in the Board of the company applying for license should be Indians. Chairman, MD, CEO or CFO(Chief Financial Officer), if held by foreign nationals, would require security clearance from Ministry Of Home Affairs.

8.      The entry fee for the Unified license will be  (a) Rs 20 crore for National Unified Licence; (b) Rs 2 crore for each metro or A category circle, Rs 1 crore for each B category circle level Unified Licence and (c) Rs 15 lakhs for each District Level Unified Licence.

9.      National Level Unified Licence shall permit the licensee to provide any or all of the telecom services mentioned at para 2 above;

10.  Service Area (Circle) Level Unified Licence permits the Licensee to provide all the services mentioned at para 2 above, except NLD( National Long Distance) ; ILD(International Long Distance) ; GMPCS(Global Mobile Customer Service by Satellite);  V SAT (Very Small Aperture Terminal) services;

11.  District Level Unified licence shall permit the licensee to offer any or all of the telecom services mentioned in para2 above, except NLD( National Long Distance) ; ILD(International Long Distance) ; GMPCS(Global Mobile Customer Service by Satellite);  V SAT (Very Small Aperture Terminal) services; and also will not be permitted to provide wireless access services and they will not be entitled for assignment of spectrum resources for access services(They cannot give any service by wireless).

12.  The licence period will be 20 years. On expiry, it can be renewed for 10 years at a time, by paying a renewal fee.

What is the implication of delinking of licence and spectrum? Does it mean that a national or circle level licensee who will not buy spectrum can buy it from another licensee who bought the spectrum? When spectrum will be auctioned/sold, whether it can be purchased by one who do not have licence for telecom services? Does it not mean somebody would purchase spectrum in wholesale and sell it in retail, which is nothing but hoarding and trading of spectrum which should be avoided? Does it mean a licensee without spectrum can be allowed to share the spectrum of another licensee having spectrum? Does it mean a licensee without spectrum will be allowed to provide mobile services by allowing his subscribers to roam on the network of other licensee having spectrum, without ever having its own mobile network, thus introducing a new system of MVNO (Mobile Virtual Network Operator)? What is the implication in allowing license for even a single district or more than one district opted by the licensee, without allowing  offering of  mobile services? Does it mean they will be internet service providers and if so, how? Whether they will utilise the copper loops of other operators, meaning that the local cable of BSNL be unbundled? These are all the questions arising with these draft guidelines.

Comments were invited by TRAI on these draft guidelines from stake holders by 31^st January 2012. Thereafter these guidelines will be finalized by TRAI.