New telephony regulations notified

New Delhi: The government has decided to do away with the existing internet protocol-II (IP-II) and internet protocol virtual private network (IPVPN) licences and has notified new national long distance (NLD) and international long distance (ILD) norms.

The department of telecom has in effect amended the NLD and ILD licences and the universal access service licence (UASL) to incorporate the new norms. It has also amended the VSAT licences to reduce the revenue share between the government and operators to 6 per cent from the existing 15 per cent.

According to the amendments for NLD licences, the entry fee has been slashed to Rs2.5 crore from the existing Rs100 crore, while the annual licence fee has been cut to 6 per cent of the adjusted gross revenue (AGR) from 15 per cent at present. The mandatory rollout obligations have also been removed.

The net worth requirement and paid-up capital have been fixed at Rs2.50 crore, against Rs2,500 crore and Rs250 crore respectively at present. NLD service providers can also offer last mile connectivity now.

In the ILD sector, the entry fee has been reduced to Rs2.5 crore from Rs25 crore at present.

Here again the rollout obligations have been removed and ILD service providers can access subscribers directly with regard to leased circuits closed user groups.

Also for entry into ILD and NLD sectors, prior experience in the telecom sector is not a prerequisite for being granted telecom service licences.

Other changes include allowing UASL licence access providers to provide internet telephony, internet services and broadband services (including triple play — voice, video and data) who can also use the network of NLD and ILD operators.

Also existing holders of IP-II and IPVPN licences would have to migrate to NLD or ILD service licence implying that internet service providers with internet telephony will be charged licence fee at 6 per cent of AGR. They, however, cannot provide content services on a managed network not derived from Internet.

The new regulations would come into force from January 1, 2006

Telecom department officials said that the new norms would lead to further reduction in telecom tariffs in the country and would lead to more competition and allow smaller players to enter the market.