The Hindu Business Line : New telcos may miss roll-out targets

New Delhi, Nov. 13 The Department of Telecom has expressed concern with new telecom players who have not launched their services despite having given the licences almost 9 months ago.

According to the terms and conditions specified in the licence, they are required to cover at least 10 per cent of each district headquarters in a circle in the first year.

With just 3 months to go for the deadline, none of the new players is close to achieving the roll-out obligation. Barring Shyam Telelink, none of the companies which had bagged their licences during February-March has launched its services.

The companies which had taken the licences early this year include Unitech, Swan, Datacom, Loop Telecom, Shyam Telelink and S Tel. While Shyam Telelink has launched its services only in Rajasthan, other operators are still working out their partnerships, network vendor and overall business model. According to industry estimates, operators will take at least 6 months to cover 10 per cent of each district headquarters after launching the service. This means that the new companies may be able to complete the target only by end of next year instead of February 2009.

Spectrum delay

But the new players say that the delay in getting spectrum from the Government has pushed back the launch date. “We have got licences for 22 circles, but even now we do not have spectrum for all the regions. So how are we going to roll out our network without spectrum,” said a new operator.

In the past, DoT has asked defaulting operators to complete the roll-out by laying fixed line network. It had even imposed liquidated damages on some companies for failure to comply with the licence conditions. DoT can impose a fine of Rs 5 lakh a week for the first 13 weeks of delay, Rs 10 lakh for the next 13 weeks and thereafter at the rate of Rs 20 lakh for delays of up to 26 weeks. If any operator fails to fulfil the obligation even after 52 weeks of delay, then DoT has the power to cancel the licence. The countdown for the new players will start from February 2009.