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The telecom department maintains the operators will have to bid in the spectrum auction to continue their services.
The Department of Telecommunications (DoT) has reportedly refused to grant licence extension to Vodafone and Loop Telecom, and said the operators will need to bid for the spectrum to continue their services. The DoT is likely to send similar notice to Bharti Airtel.
"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," says an Economic Times report.
Vodafone has expressed disappointment over the rejection of requests for the licence extension, saying the move is against the “interests of our several million customers”.
"In addition, there appears to be no acknowledgement by DoT of the full and faithful operation of the licence 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...," said the telecom operator in a statement.
It’s notable the operators, Vodafone, Loop and Airtel, have gone to court against the move to auction the spectrum they currently hold, and asked for licence extension using the same band.
The telecom department has previously maintained the licence has been de-linked from the spectrum, and that the companies will have to participate in the auction and win to regain licence.
Earlier, seeking extension of its licence Vodafone in its letter to the DoT had said: "The 19th year of licence has commenced on November 29, 2012 for Mumbai circle and Novermber 30, 2012 for Delhi and Kolkata circles ... we request you to extend the period of our licence ...on terms to be mutually agreed." Vodafone also alleged legal infirmity in the auction guidelines.
The DoT, however, rejected Vodafone's claims, saying “As for licence renewal, if operators do not accept the renewal terms, there will be no renewal of licence.”
The spectrum up 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 up for renewal in 2014.
Source: Economic Times