The Department of Telecom has rejected Vodafone’s request to extend its mobile licences in seven circles. These licences were given for a twenty year period and are set to expire in December 2015. Vodafone had written to the department seeking an extension of the licences for another 10 years.

Declining the plea, the DoT has taken a view that Vodafone should acquire fresh permits under the new Unified Licence regime and buy back spectrum during the next round of auction if it wants to continue operations in the seven circles of Kerala, Tamil Nadu, Haryana, Rajasthan, Uttar Pradesh (east), Maharashtra and Gujarat.

Vodafone had submitted the application because under the earlier licence rules there was a provision for operators to make a request for extension on mutually agreed terms. Vodafone had even offered to pay entry fee afresh if it was allowed to retain spectrum in these circles. However, post the Supreme Court ruling on the 2G spectrum scam, DoT has changed its rules for allocating spectrum. The Court had said that spectrum should be given through market determined process. Under the new Unified Licence regime, spectrum has been de-linked from the licence. The DoT has conducted several rounds of auction to enable operators to acquire spectrum. Most operators whose licences are set to expire in November this year have already bought back spectrum during the auctions held in February.

“DoT’s decision does not come as a surprise because it is consistent with the current policy. Vodafone and other operators like Idea Cellular whose licences expire next year will have no option but to acquire spectrum from the market. This will add to their costs,” said a telecom analyst.

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