New Delhi, Mar 23: The Department of Telecommunications has told Vodafone and Loop telecom that their licences cannot be extended and they will need to bid for airwaves to continue their services. Millions of subscribers are going to be affected by this government order.
A late statement issued by Vodafone said: “Vodafone is deeply disappointed with the summary rejection of its request for extension of its licenses in Delhi, Mumbai and Kolkata service areas by DoT.
“This decision is against the interests of our several million customers in these cities/circles.
“In addition, there appears to be no acknowledgment by DoT of the full and faithful operation of the license for 18 years - for being a pioneer and entering the market when there was no concept of mobile telephony in India, for investing tens of thousands of crores in setting up a state of the art network, for serving millions of subscribers and for contributing to the national tele-density objectives, for being the second largest rural mobile service provider in India.
“Vodafone has also been consistently contributing several crores in revenues to the national exchequer. Clearly, in DoT's opinion, these aspects are not important for determining expediency”, the Vodafone statement said.
Meanwhile, government sources said: “DoT has said that clause related to extension of licences, companies should not read ‘may' as ‘shall' extend licence. Hence their request to extend licences have not been accepted by DoT.”
Sources added that similar letter will be sent to Bharti Airtel as well Vodafone, Loop and Airtel have approached court against government's plan to auction spectrum that they currently hold and has sought extension of licence using the same spectrum.
The telecom firms contended that they have in their possession the 900 MHz spectrum since November 1994 and without considering their plea for renewal of licence, their request has been turned down.
Sources said that DoT has asked these companies to participate in spectrum auction to retain the spectrum and continue their services.
The spectrum identified for auction in 900 Mhz includes 8 Mhz held by Bharti Airtel and Vodafone each in Delhi circle; 8 Mhz each of Loop Mobile and Vodafone in Mumbai; and in Kolkata 6.2 Mhz spectrum of Bharti Airtel and 7.8 Mhz of Vodafone that is due for renewal in 2014.
The auction of these spectrum was scheduled to start from March 11 but none of the companies applied to bid for these airwaves and hence it failed.
Government has announced that it will conduct third round of auction but details of this auction have not been announced yet.
