The Hindu Business Line : Reliance Comm signs long-distance licence

RELIANCE Communications Ltd has signed a licence agreement with the Department of Telecommunications (DoT) for international long-distance (ILD) services, which is being opened up for competition starting April 1.

This makes it the first telecom operator to have signed the ILD licence agreement, ahead of Bharti, Data Access, Connecting Networks and Pacific Net Invest, which have been issued letters of intent for the service.

According to Reliance officials, the company paid a one-time non-refundable entry fee of Rs 25 crore in addition to an unconditional bank guarantee of Rs 25 crore which will be released on fulfilment of its rollout obligations.

The period of licence is for 20 years, with automatic extension for another five years subject to satisfactory performance in accordance with the relevant terms and conditions of the licence.

The officials, however, noted that although the licence was signed today, the ILD operations would commence only after a couple of months.

"The first step was to sign the licence agreement. We now have to put our basic operations in place, and then sign interconnect agreements with the national long-distance operators and access providers. This will be a bit time consuming," they said.

They noted that unlike other major telecom operators, Reliance would like to launch all their services — basic, NLD and ILD — in one go across the country, rather than in a piecemeal manner. This makes sense, if it has to offer fully integrated services to the subscribers, they said.

As regards the ISD tariff that is proposed to be offered, they noted that the present tariff would certainly be brought down. "We will offer very competitive rates. They should be at least 50 to 60 per cent less than that prevailing now," they said.

The officials noted that the company is now expected to submit a detailed network rollout plan. To add to it, a written commitment is also to be given stating that it will adhere to the interoperability conditions in a multi-operator environment.

The rollout obligations specified by DoT stipulate that within three years from the date of the licence agreement, receipt and delivery of traffic from/to all the exchanges in the country should be ensured through one or more gateway switches having appropriate interconnections with the NLDOs and meeting the TRAI's quality of service regulations and network-to-network interface requirements. For this purpose a minimum of at least four direct routes, one in each region of the country needs to be established.

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