The new service authorisation regime in the telecom sector must continue to retain the contractual nature of the present licences to ensure uniformity, regulatory certainty, and protection for investors who commit long-term capital to the sector, the Cellular Operators Association of India (COAI) said on Monday.
In a major overhaul of the licensing ecosystem in the telecom sector, the telecom regulator last week recommended that three new categories of authorisations be created to cover the gamut of telecom services in the country, in line with the new Telecom Act, 2023.
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COAI, which represents private sector telecom operators Reliance Jio, Bharti Airtel, and Vodafone Idea, said the recommendation further provided an opportunity for TRAI to facilitate and reduce the burden on the industry by suggesting the financial reforms badly required by the sector.
COAI highlighted the need to include only those revenues received under telecom services, under various authorisations, for the calculation of Adjusted Gross Revenue (AGR). However, this issue remains unaddressed in the recommendation, it said.
Telecom service operators fear that replacing the current licence regime, based on a ‘contractual agreement’ with the government, could threaten their investors and investments by creating major ‘regulatory uncertainty’ and a lack of ‘predictability’.
In a meeting with Telecom Minister Jyotiraditya Scindia last week, telecom executives made it clear that the new authorisations should only provide for broader aspects like the application process and eligibility conditions, while the detailed terms and conditions should continue to form part of the contract between the government and telcos.
“It may be pertinent to note that TRAI’s recommendation that the central government should grant service authorisation under Section 3(1) of the Telecommunications Act, 2024, instead of entering into an agreement with the entity, is without any valid justification and goes against the position of telecom service providers (TSPs), while also undermining the current regime that has worked successfully for more than three decades—bringing enormous inflows of investments and growth to the sector,” COAI said on Monday.
TRAI also stated that the exclusion of over-the-top (OTT) communication services from the new authorisation is a major concern, as this omission perpetuates an uneven competitive landscape, with telcos continuing to bear the weight of extensive compliance and security requirements.
“Such services are also not subject to any regulatory oversight on critical issues like spam prevention, despite their growing role as alternatives to conventional telecommunications services,” TRAI argued. OTT players remain largely unregulated, raising questions not only about market fairness and regulatory consistency in the rapidly evolving digital communications sector but also about national security and customer privacy, it added.
First Published: Sep 30 2024 | 6:51 PM IST
