In a major relief to mobile telephony customers, the Telecom Regulatory Authority of India (Trai) has decided not to recommend capping the number of operators in telecom services. The regulator will submit its recommendations to the Department of Telecommunications (DoT) in a fortnight. Big cellular mobile service providers are strongly opposed to issuing licences to new service providers.

Sources said the regulator is now busy tackling the issue of spectrum in view of the fact that it is a limited natural resource. Spectrum is currently managed and assigned by the wireless planning division of the Department of Telecommunications (DoT). Being a government department, which is also responsible for policy making, DoT has not been able to efficiently manage spectrum.

If DoT is able to announce in advance the availability of spectrum for at least a year, it may help in issuing new licences. However, the biggest problem is that while assigning spectrum, no differentiation is made between a metropolitan city and a small town. For instance, there may be a spectrum crunch in Bangalore but not in other parts of Karnataka, where the population density is low. DoT, however, assigns spectrum for the whole of a state. As a result, operators inefficiently use spectrum outside big cities.

At presently, there are five operators that have a pan India presence — Airtel, Reliance, Hutch, Tata and BSNL/ MTNL. They say that new operators should not be permitted as they will become financially unviable if competition is increased. They also argue that since spectrum is limited, no new licences should be given.

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