The ‘3G roaming’ controversy, which continues to cast a shadow over services to lakhs of 3G customers in India, may be nearing an end soon.
The controversy, involving the sharing of 3G infrastructure between operators, has the potential to disrupt the Indian 3G market in the coming weeks as the government decides to either crack down hard or settle with telecom operators in return for monetary compensation.
Miscalled ‘3G roaming’, the practice refers to the provisioning of 3G services by operators even in states where they have no 3G spectrum or 3G-enabled license. Operators such as Bharti Airtel, Vodafone and Idea Cellular offer 3G services almost across the country, even though they have 3G spectrum on only about half the states.
In this one-and-a-half-year-old saga that is fast reaching conclusion, the government alleges that it is losing money by this ‘unauthorized’ sharing of 3G infrastructure among private operators. The operators, on the other hand, contend that their licenses already allow them to provide any sort of wireless service, including 3G.
The operators first approached the Telecom Disputes Settlement & Appellate Tribunal a year ago, after the Department of Telecom (DoT) sent them notices directing them to stop 3G services where they did not have 3G spectrum. The tribunal largely ruled in the government’s favor, saying that the DoT can pass “appropriate orders” after giving due opportunity of hearing to these companies.
Saying that the companies did not “submit compliance reports” with regard to its earlier instructions even after the TDSAT judgment, the government again sent show cause notices in September asking financial penalties may not be levied for failing to comply with its directions.
This time, the operators went to the Delhi High Court. The High Court temporarily stayed any punitive steps from DoT’s side, but also gave it the authority to “adjudicate upon the issues raised before it, after according the company, through its representative, a hearing in the matter.”
That time of adjudication is fast coming to a close, bringing the saga to a close. “Pending the adjudication, the DoT will not take any coercive measures against the company,” the government has said.
The two options before the government are to either force the companies to stop providing 3G services in states where they don’t spectrum and a “3G-enabled” license, or to allow them to continue to do so, but after changing their licenses to allow the government to get a higher share of their revenue.
Smelling trouble, operators other than the above three have already stopped providing 3G services in zones where they don’t have 3G spectrum. A forced stoppage of 3G services in areas where a company doesn’t have spectrum will leave millions of 3G customers in India without 3G.
They would either be forced to change their providers using mobile number portability (MNP) or be happy with 2G services.
Operators would also be hit hard as it would take more effort to monetize their investments in 3G. Currently, with up to three operators helping monetize a fixed block of 3G spectrum in a state, companies are able to recoup their investments in this costly segment faster than anticipated.
In addition, having a national footprint — even if it is through sharing — helps companies justify 3G promotions on national media like TV channels.