Hard push toward openness

Braham Singh
06 Dec 2007

Sometimes, wisdom is a burden. This is what the Indian regulatory authority is living out through the industry's consultative review process. Halfway through the TRAI's August 2007 review on capping service providers, I realize this is not the India I bolted from in the 1980s.

However, a sizable part of that India still resident in the DoT does not like a wise TRAI. Incumbents are equally unsettled with the consistency of TRAI's assessments.

The review echoes the TRAI's September 2006 review on allocation and pricing of spectrum for 3G and wireless broadband in that one sees an approach to competitiveness and transparency.
One may quibble with the conclusions, but its arguments are thought through and are consistent across the TRAI's various reviews. For TRAI, the New Telecoms Policy (NTP) of 1999 is a telecom constitution that, barring amendments, cannot be violated.

'It is evident from the NTP that there is no intention of placing any artificial cap on the number of [mobile] access service providers,' TRAI says. 'Clearly, the underlying theme is to ensure optimality for existing operators so as to provide good quality but at the same time it has not barred entry of new operators.'

With that, the review disabuses incumbents of any hope to restrict membership to the cellular club. For businessmen with an acute sense of smell, the opinion announced in the summer provided more than just a whiff of opportunity to start a stampede.

With 200-some license applications lodged, the DoT must think the TRAI has lost its head. Speaking to the Indian Express, a senior DoT official termed the rush of applications as 'sheer madness' and said the department would start scrutinizing these once a committee appointed by Communications Minister A Raja comes up with fresh guidelines detailing the minimum net worth, ownership and other crucial aspects of the applicants.

By mid-September, an overwhelmed DoT said it would no longer accept applications after October 1. Not to cap applicants, it added, but because it made little sense accepting any more applications before the ones received could be processed. Besides, where was the spectrum to distribute among the aspirants‾

I suspect the TRAI maintains its opinion and views the rush with a sanguinity based on a principled approach to licensing, allotment and pricing. Maintain course, it suggests, and let market forces resolve matters.

But after so many years under a licensing Raj, it may not be just market forces cajoling applicants to submit the forms in triplicate. Also, it is anyone's guess how many of these stellar newbies are being grandfathered by incumbents to access additional spectrum.

TRAI's market-driven thinking could not be any more at odds with the DoT mindset succinctly laid bare in a letter earlier in the year. While it officially requests a review, the underlying tone screams out:* Our concern is cellular and nothing but the two cellular life forms of GSM and CDMA* Please, oh please, tell us we can cap applicants. There's a shortage of spectrum and the incumbents - those guys who always ante up when asked - need it for themselves.

Well, the TRAI responded by tightening the subscriber-linked criteria for additional spectrum, eliciting more howls of protest.

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