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Our Bureau

New Delhi, Oct 19 Reliance Communications took the first step towards offering cellular services using GSM technology across the country by paying an entry fee of Rs 1,651 crore to the Government.

The move comes after the Department of Telecom on Thursday allowed the country’s largest CDMA player to use GSM technology under the existing unified access licence it holds. While DoT had given 15 days time to RCom to pay the entry fee, the company has submitted the amount within a day indicating the importance it is attaching to this move.

Though the DoT categorically said that the permission to use two technologies did not assure release of GSM spectrum, by paying the fee Reliance has broken out of the long queue of 575 applications for new telecom licence and put itself ahead in a new category of those companies which have already paid the entry fee and are awaiting release of spectrum. Idea Cellular, Spice and Aircel are the three other companies, which are already in this category.

DoT officials said that Reliance was given the permission ahead of the other 44 companies because the application, made in February 2006, was not for a new licence but was only seeking permission for deploying a new technology under its existing licence. While an additional 4.4 Mhz of GSM spectrum could increase the company’s valuation considerably, Reliance will now be able to take on the existing GSM players such as Bharti Airtel and Vodafone Essar on equal terms.

The Cellular Operators Association of India said that the decision by DoT was legally untenable. Existing GSM operators are also upset because DoT has simultaneously increased the number of subscribers required for them to get additional spectrum.

This is the second time that Reliance is trying to get into the GSM space. In 2002, when the Government had auctioned licence for the fourth cellular berth, Reliance – then under Mr Mukesh Ambani – had unsuccessfully bid for a pan-India licence where it lost out to the likes of Idea and Bharti.

However, in 2007, it has managed to finally get a foothold into the GSM space by paying exactly the same amount that the fourth cellular operator had paid for a pan-India licence five years ago.

More Stories on : Telecommunications | Technology | Regulatory Bodies & Rulings | Reliance Communications Ltd

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