One licence with pan-India cover or 4 regional zones.

Thomas K. Thomas

New Delhi, Oct. 13

In a move that will bring down roaming tariffs in the country, the Department of Telecom is considering a proposal to reduce the number of licensed areas from 22 circles to a single licence with pan-India coverage or to four regional zones.

The proposal is being discussed by an internal core team on licensing issues as part of the DoT's plan for the next few years.

“Keeping in view the development of technologies for catering to more traffic and more number of subscribers, we are looking at whether operators can be given the option to merge service areas. There could be either one service area covering the entire country or there could be four or five areas each, covering a specific region,” a top DoT official told Business Line.

Preliminary stage

The official added that the proposal was at a preliminary stage and is being discussed with the industry.

At present, the entire country is divided in 22 telecom circles and the DoT issues licence for each circle separately. As a result, operators are required to put a mobile switch in each circle and also charge interconnection fees when calls are made from one circle to another. If the concept of circles is done away with, consumers need not pay roaming charges.

However, industry experts said that though the proposal is conceptually a good idea, there are many issues to be resolved before it can be implemented.

“The DoT currently gives spectrum on a circle basis. Does it have enough spectrum to give on a zonal or a national basis if it changes the licensing regime? The DoT will also have to resolve inter-connection related issues, which is very complex,” said an operator.

Another player said that roaming tariffs in the country are already as low as Rs 2 per minute, so undertaking such a complex shift may not be desirable.

But new operators may benefit from such a move as they will be able to set up just one switch and start offering services across the country.

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(This article was published in the Business Line print edition dated October 14, 2010)
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