Mobile operators may move court against DoT’s notices to pay around Rs 24,989 crore fee

Telecom Lead Asia: Mobile service providers such as Airtel, Vodafone and Idea Cellular are likely to approach the court against DoT’s notices to all operators directing them to pay around Rs 24,989 crore fee on the existing spectrum they hold.

This will be a big blow to Indian telecom operators who are finding new ways to spruce up revenue streams.

READ MORE: Bharti Airtel and Vodafone – have increased 2G data rates by up to 30 percent in 2013. Rivals are expected to take similar steps to cover costs and improve margins. Airtel revised its 1GB 2G data plan from Rs 100 to Rs 125.

DoT last week informed all GSM mobile operators about its decision to impose a one-time airwaves charge, both prospectively and retrospectively, which would come into effect from January 1, 2013.

Rajan Mathews, director general of the Cellular Operators Association of India

“The notices have come. Individual operators will be moving the court soon on this,” Rajan Mathews, director general of the Cellular Operators Association of India, told Economic Times.

In November, the Cabinet had cleared the proposal to impose a one-time airwaves charge on GSM-based operators, a move that will force the industry to shell out a minimum of Rs 24,989 crore.

Of the Rs 24,989 crore payment, the share of private operators is about Rs 13,171 crore and the Center will bear the cost of this one-time fee for state-owned companies — BSNL and MTN. The DoT has given telcos the option of paying a third of this charge upfront and the rest in equal annual installments based on the validity of their licenses.

The department will issue separate orders soon regarding the rate for one-time spectrum charge for CDMA operators that hold spectrum beyond 2.5 MHz in the 800 MHz band. In December, the chief executives of India’s top three mobile phone companies Airtel, Vodafone and Idea Cellular had sought Prime Minister Manmohan Singh’s intervention on this issue.

Bharti Airtel CEO Sanjay Kapoor, Idea Cellular MD Himanshu Kapania and Vodafone India MD and CEO Marten Pieters, in a joint communication, had told Singh that the one-time charge violated terms of the licence, breached the bilateral settlement the government had reached with the industry in 2002 and also contradicted the statement made by the ministry on the floor of Parliament.

They had also added that this one-time charge contradicted the government’s stance in affidavits it had filed with the telecom tribunal and was also against TRAI’s views and recommendations during the last 10 years.

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