Unified licence dispute could spiral out of control

3 Nov 2003

The legal dispute surrounding the Indian government’s plans to introduce a system of unified licensing for fixed line and mobile operators looks set to escalate, despite the efforts of the administration to – as it sees it – resolve the issue. The regulator, the Telecoms Regulatory Authority of India (TRAI), recently submitted proposals to the state recommending a unified licensing system which would effectively open up the wireless sector by allowing fixed line operators to offer limited mobility wireless in the local loop (WiLL) services. Although the state anticipated that unified licensing would bring the dispute to an end, the country’s cellcos are strongly opposed to WiLL, claiming that fixed line companies selling WiLL phone services would effectively gain a nationwide mobile licence at a knock-down price. The government looks set to award chief WiLL protagonist Reliance Infocomm a licence to offer limited mobility services for USD335 million under the new regime, but this is significantly lower than the USD640 million average paid by the country’s mobile operators. Representatives of the cellcos now hope the Supreme Court will examine the issue and expose what they believe is the ‘complicity’ of the government to actively encourage WiLL to compete against wireless operators.