Indian operators threaten to walk

Michael Carroll
07 Feb 2012
Daily News

A growing number of Indian operators are talking of exiting the market as a result of the cancellation of 122 2G licenses issued in a 2008 auction.

Batelco yesterday became the latest in a string of operators to talk of future options in an official statement, noting that it would examine all legal means of challenging a Supreme Court order to revoke the licenses, but ominously talking of an exit if that doesn’t work.

First the operator revealed STel, the 2G license holder it owns a 42.7% stake in, will “review the sustainability of its business operations under the revised conditions,” and then that Batelco itself “intends to explore all options to remain involved in the Indian telecommunications market.”

Batelco’s fighting talk came hot on the heels of similar combative words from Sigve Brekke, executive vice president and head of Telenor’s Asian operations. The firm’s local business Uninor stands to lose 22 licenses following the decision, which Brekke told reporters had left him deeply upset. While he said that Telenor is in talks with local authorities on the best course of action, the Wall Street Journal reports an exit isn’t out of the question.

The carriers are the latest to issue firm statements in response to the decision. Russian firm Sistema, which has a stake in MTS India, made liberal reference to the benefits it delivers to India’s economy in terms of employment and connectivity, while local operator Idea Cellular claimed it is being treated harshly despite complying with all of the 2008 auction terms.

India’s Supreme Court ordered the licenses revoked early February, and the country’s regulator has already been given the nod to arrange a fresh auction.

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