TRAI releases paper on virtual network operators

Sectoral regulator Trai today released a pre-consultation paper on virtual network operators (VNO), which offer services by tying up with existing operators without buying spectrum.

The Department of Telecom (DoT) had sought Trai's recommendations for delinking of licences for networks from delivery of services by way of VNOs including associated issues of definition of adjusted gross revenue under the Unified Licensing (UL) regime.

The Telecom Regulatory Authority of India (Trai) said the draft National Telecom Policy-2011 issued by DoT envisaged two categories of licences which are network service operator (NSO) license and service delivery operator (SDO) licence.

NSOs would be licensed to set up and maintain converged networks capable of delivering various types of services whereas SDOs would be licensed to deliver the services without having to set up the networks.

VNOs are SDO licensees, who do not own the underlying networks but rely on the network and support of the infrastructure providers, telecommunications operators (who are owners of towers, radio access networks, spectrum, etc) for providing telecom services to customers.

Trai in the pre-consultation paper said in the proposed licencing framework, based on the VNO model, one issue could be whether the existing telecom service providers (TSPs), will have to obtain an NSO licence or both NSO and SDO licences on migration to the new licensing regime?

A linked issue for deliberation will be about the necessity of changing the licensing regime at all, at such a short interval since UL was introduced, Trai added.

Trai said that In India, the TSPs have infrastructure, including spectrum, which is just about sufficient to cater to their own requirements. Would they really be able to spare their infrastructure for new SDOs?

The regulator has also sought stakeholders comments on other issues like the nature of agreement between two licensees, sharing of infrastructure, allotment of numbering resources, spectrum usage charges and lawful interception.

The stakeholders can send their comments by September 17, 2014.

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