By Telecom Lead Team: Sistema and SSTL will contest the Supreme
Court order on 2G spectrum by pursuing all available legal remedies.
In the meantime, Indian operations will remain business as usual
for SSTL, a national telecom operator serving more than 15 million customers,
employing over 3500 employees, and with investments of over $2.5 billion.
The Supreme Court of India issued a judgment on February
2nd revoking
122 telecom licenses of 11 telecom operators, including 21 of the 22 licenses
held by Sistema Shyam TeleServices (SSTL).
The order was issued on the grounds that these licenses were not
granted in accordance with required procedures by the Department of
Telecommunication. The court has further directed the Telecom Regulatory
Authority of India (TRAI), India’s top telecom regulatory body, to make fresh
recommendations on the grant of 2G licenses and the re-allocation of spectrum
via auction within 4 months by the Department of Telecom (DOT).
Sistema by way of its investments in SSTL has fully demonstrated its
commitment to its Indian operations and is very disappointed by the Supreme
Court’s decision. In essence, Sistema and SSTL are being penalized for
acting in good faith and in reliance on the appropriateness of the procedures
established by India’s telecommunications authorities. Sistema
therefore looks forward to a clear, transparent, and equitable policy decision
on these matters by the Indian government,” MTS India said in a statement.
Meanwhile, mobile major Telenor is likely to exit
India after the Supreme Court revoked its mobile licences and may not wait for
new telecom guidelines to be introduced, according to media reports.
Telenor threatens to exit Indian telecom market
Supreme Court revoked 122 telecoms licences issued in 2008, including 22
licences Telenor holds via Uninor, a joint venture with real estate firm
Unitech.
Uninor
has 5.68 percent market share in India and posted around 651 crore revenue in
Q2 FY 2011-12.
Affected licence holders can operate for four months, during which regulators
will come up with new market rules. The telecom regulator TRAI has already said
it favors auction route to release 2G spectrum.
Asked whether Telenor should heed calls by several company investors and
analysts to quit the Indian market now and cut its losses, Jon Fredrik Baksaas,
CEO of Telenor told Reuters: “That is one alternative that is on the
table.”
