Sans implementation timeframe, telecom policy is less convincing

The National Telecom Policy 2012, cleared by the Cabinet on Thursday, envisages a slew of initiatives, including free roaming, unrestricted Net telephony and a new unified licensing regime for operators.

The policy gives specific emphasis to push broadband uptake and increase local manufacturing of telecom equipment. The policy promotes indigenous R&D, innovation and manufacturing to reduce dependency on imports and enhance the exports. The highlight of the draft is the move towards unified licensing with the proposed one nation-one licence regime. The policy supports delinking of spectrum from the licence as well as spectrum sharing, trading and pooling.

The policy document is, however, silent about when and how the proposals will be implemented. The Communications and IT Minister, Mr Kapil Sibal, said the proposals will be implemented over the next 10 years and detailed guidelines for each of the initiatives will be brought out later.

But for that the Telecom Minister will have lot of convincing to do. Many of the proposals have been objected to by other Ministries. For instance, the proposal on manufacturing will have to comply with WTO norms. The decision to abolish roaming charges will also have to go through the TRAI.

But when it's implemented, it will bring cheer to consumers who have been reeling under recent tariff hikes.

No roaming charges

The biggest gain would be for those who travel a lot, as roaming charges are set to be abolished. This means that subscriber will get free incoming calls and outgoing calls at local tariffs anywhere in the country.

Introduction of inter-circle Mobile Number Portability will enable users to carry their phone number from one State to another. For example, an Airtel user in Delhi can shift to Vodafone's network in Chennai and retain the phone number. Currently, MNP is allowed only if the user wants to change operator in the same circle.

The other major gain for consumers will be on the proposal to allow unrestricted Internet Telephony. This will allow subscribers to use the Internet to make local and STD calls to a fixed or mobile user. Under the existing rules, consumers are allowed to make only PC-PC calls on the Internet. This is also good for Internet Service Providers like Reliance Industries promoted Reliance Infotel as unrestricted Net telephony will allow them to offer voice services on top of data.

New revenue streams

For the other operators, the NTP brings some relief in terms of permitting them to share and trade spectrum. This will not only open up new revenue streams but also enable operators to utilise spectrum efficiently.

But operators face loss of revenue due to abolition of roaming charges in the short term. “ If the policy is properly implemented it would not only benefit telecom operators and consumers but would also benefit telecom manufacturing sector as telecom equipment manufacturing has been given special importance in the policy,” said Mr Hemant Joshi, Partner, Deloitte Haskins & Sells.

Operators can also hope to get airwaves more freely as the policy envisages about 300 Mhz of additional spectrum by 2017.

The new policy comes at a time when the telecom sector is reeling under the multiple impact of the 2G spectrum scam, falling revenues for the operators and the resulting tariff hike.

The policy is being seen as an attempt by Mr Sibal to give a broad direction for the sector in a bid to bring it back on track. But the proposals would have looked more convincing if the Telecom Ministry had given a broad time frame for implementing each of the proposals.

>tkt@thehindu.co.in

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