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Thomas K Thomas

New Delhi, July 26

The Department of Telecom may stop issuing any more cellular licences given the scarcity in spectrum. As a first step towards imposing a cap on licences, DoT has sought the telecom regulator’s view on whether more operators should be allowed to enter the market.

“In view of the fact that sufficient competition seems to be already in place and spectrum is a scarce resource and to ensure that adequate quantity of spectrum is available to licensees, to enable their services and maintain the quality of service, the Government is to take a view on the policy of no capping on the number of access service providers in each service area,” said a DoT letter to the Telecom Regulatory Authority of India (TRAI).

If DoT does impose a cap, it will close the doors on about 24 companies whose applications for new licences are pending with the Government. Companies including AT&T, Moser Baer, Sterlite Technologies and the Hinduja Group had submitted their applications in 2007 but they were not given the licences after DoT changed the cut-off date from October 1, 2007 to September 25, 2007.

These companies had recently got a reprieve after the Delhi High Court quashed the decision by the Ministry of Communications to leave out applications submitted after September 25, 2007.

Terming the change in the cut-off date as arbitrary, the High Court had said that DoT cannot be allowed to arbitrarily change the cut-off date and that too without any justifiable reason.

The court had observed that, on the one hand, DoT had accepted the telecom regulator’s recommendation of not putting a cap on the number of mobile players, and on the other, it acted contrary thereto by amending the cut-off date and placing a de facto cap on the number of service providers.

According to market watchers, the fresh move could be seen as a way to get around the Court decision. Since DoT’s September 25 cut-off date has been quashed, a policy change to cap the number of operators will keep out the 24 companies.

More Stories on : Telecommunications | Regulatory Bodies & Rulings

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