In what could be a turnaround decision, the Supreme Court has cancelled all the 122 Lincenses that were alloted in 2008 under the regime of Mr. A. Raja, stating that the licences were granted in an arbitrary and unconstitutional manner to this telecom operators. These cancelled license include 9 circles for Idea, 3 for Tata Docomo CDMA, 13 for Etisalat/Cheers, 6 for STel, Pan India License of Uninor, 21 for MTS, 21 for Loop and 21 for Videocon as well.
However, Supreme Court has given 4 months time for these operators to wind up their business and to TRAI and DoT to formulate new mechanism for auctioning the 2G spectrum all over again.
The Supreme Court also fined Etisalat, Uninor and TATA – Rs. five crore each and Loop and Essar have been fined Rs. 50 lakhs each.
Here is the complete list of Operators with Circles cancelled.
The famous 2G scam started in 2008, when then Telecom Minister, Mr. A. Raja ignored advice to hold an auction for licenses and spectrum and followed a first-come-first-serve policy. Also rules were twisted to bring benefit for the favourable companies and 122 new licenses were issued within a week at the prices of 2001.
So what next..!!
The Governement & Telecom Co’s have 4 months i.e. 120 days to formulate the new mechanism for auctining the 2G spectrum. What i think is gonna happen is that within these 4 months, a fresh 2G auction would be held and all the companies who are serious for doing business in India like MTS, Uninor would sit in the auction without the Indian partners. Companies like Videocon, Loop, Etisalat might not partipate in the auctions but Idea and Tata would definetely do.
After getting spectrum, these companies would send plea to the government about investment worth million across India and would get approval to continue their operations.
Else, consumers can very easily shift to other operators via MNP.
What ever happens, one thing that is sure, Tariff Hike. Auction of spectrum would lead to higher operation cost, which would give way to TARIFF HIKE. So guys be ready to shell out more for call, sms etc within the next 6 months.
You can also download CAG Report on Telecom Licenses distribution in 2008, click here.