3G roaming: No end in sight yet to dispute between Centre and telecom operators
A victory for operators will be welcomed by consumers. While, if the DOT wins,
consumers will have to wait till the time more 3G bandwidth is released
into the market for accessing data services across India.
There is no end in sight yet to the dispute between the Centre and telecom operators over third-generation (3G) roaming services. On March 18, the Delhi High Court stayed a Department of Telecom (DOT) directive asking Bharti Airtel to stop offering high-speed data services where it does not have 3G spectrum. Five days earlier, the court had passed a stay order in a similar case involving Idea Cellular. The orders come as a breather not only for the operators but also for their 3G subscribers.
The origins of the dispute lie in the 3G auctions of 2010 where no operator got pan-India bandwidth. Bharti, Vodafone and Idea won spectrum in 13, 9 and 11 circles, respectively, and later formed alliances for the remaining circles. This allowed them to offer 3G services across the country by sharing airwaves. The three companies now have about 12 million 3G users.
Analysts view these pacts favourably. "Using each others' network ensures optimum utilisation of resources," says Mahesh Uppal, partner at consultancy Com First. Telecom operators claim that a February 2010 explanatory note by the DOT prior to the 3G auction permitted roaming. The DOT though says such pacts are "illegal".
The dispute first reached the Telecom Disputes Settlement and Appellate Tribunal, which gave a split verdict in July last year. In November, the DOT sought to make its position stronger when it added a clause to stop this practice in the letters of intent issued to operators in a bandwidth auction. Idea moved the Delhi High Court in February against the clause. Bharti approached the court in March after it received a DOT notice for its roaming pacts with Idea and Vodafone.
Analysts believe operators have a strong case . Uppal says the rules governing the usage of 3G spectrum are ambiguous. "The government should make policies that benefit the end consumer," he says.
Shobhit Khare, analyst at brokerage Motilal Oswal Securities feels that operators should be allowed to use any bandwidth to offer multiple services. "3G is just a technology. If an operator has a licence for a particular circle, it should be allowed to offer any service - 2G, 3G or landline," he says.
While the high court's ruling can go either way, a victory for operators will be welcomed by consumers. If the DOT wins, consumers will have to wait till the time more 3G bandwidth is released into the market for accessing data services across India.
The origins of the dispute lie in the 3G auctions of 2010 where no operator got pan-India bandwidth. Bharti, Vodafone and Idea won spectrum in 13, 9 and 11 circles, respectively, and later formed alliances for the remaining circles. This allowed them to offer 3G services across the country by sharing airwaves. The three companies now have about 12 million 3G users.
Analysts view these pacts favourably. "Using each others' network ensures optimum utilisation of resources," says Mahesh Uppal, partner at consultancy Com First. Telecom operators claim that a February 2010 explanatory note by the DOT prior to the 3G auction permitted roaming. The DOT though says such pacts are "illegal".
The dispute first reached the Telecom Disputes Settlement and Appellate Tribunal, which gave a split verdict in July last year. In November, the DOT sought to make its position stronger when it added a clause to stop this practice in the letters of intent issued to operators in a bandwidth auction. Idea moved the Delhi High Court in February against the clause. Bharti approached the court in March after it received a DOT notice for its roaming pacts with Idea and Vodafone.
Analysts believe operators have a strong case . Uppal says the rules governing the usage of 3G spectrum are ambiguous. "The government should make policies that benefit the end consumer," he says.
Shobhit Khare, analyst at brokerage Motilal Oswal Securities feels that operators should be allowed to use any bandwidth to offer multiple services. "3G is just a technology. If an operator has a licence for a particular circle, it should be allowed to offer any service - 2G, 3G or landline," he says.
While the high court's ruling can go either way, a victory for operators will be welcomed by consumers. If the DOT wins, consumers will have to wait till the time more 3G bandwidth is released into the market for accessing data services across India.
