India Telecom Firms With Revoked Permits Ordered to Stop Services - Wall Street Journal (India)

By R. JAI KRISHNA NEW DELHI--India's Supreme Court Friday ordered the local units of Telenor ASA and Sistema JSFC as well as other companies whose telecom licenses were cancelled last year to immediately stop services unless they have already acquired fresh permits. An immediate shutdown of operations will affect about 23 million cellphone users, or less than 3% of India's mobile-telephone subscribers. They can shift to other service providers while keeping their existing phone numbers using the number portability technology, but such transfers usually take a few days to complete. Last February, the court revoked as many as 122 telecom permits held by several companies citing corruption in their allotment. The court asked the government to auction the bandwidth given under the cancelled licenses and allowed the affected companies to provide services until the government completed the auction and bandwidth allotment. The government held an auction in November, but some of the companies with revoked licenses such as the local unit of Russia's Sistema didn't participate in it. Most others including the unit Norway's Telenor bought permits for airwaves in only a few of the service areas where their previous licenses were revoked. India is divided into to 22 telecom service areas. Under local law, companies need separate licenses for each of the areas. The government plans to hold another auction next month to allot bandwidth in the service areas where it didn't get any bids in November. Friday, the court also ordered the companies to pay a fee to the government for holding bandwidth to provide services so far under the revoked permits, a lawyer involved in the case said. This fee will be based on the starting price fixed for the November auction, he said. In the case of Sistema Shyam Teleservices Ltd., the court said it would clarify about its operations in another order later, the local unit of Sistema said in a press release. Telenor's Indian unit, which bought permits and bandwidth in six telecom service areas in November, said it will be able to comment only after studying the order. "There will be no impact" in the six service areas where it got the bandwidth back, the company said in a statement. Among others, Idea Cellular Ltd. had bought back bandwidth in all the six service areas where its previous permits were revoked. The company's services are unlikely to be affected due to Friday's order. Tata Teleservices, 26%-owned by Japan's NTT DoCoMo Inc., last month shut its operations in three service areas where its licenses were revoked. The company has permits in the remaining 19 service areas. Videocon Telecommunications Ltd. got bandwidth in six service areas through the November auction. It previously held licenses in all the 22 areas. Idea, Videocon, and Tata Teleservices weren't reachable for comments. Two other companies--local joint ventures of Emirates Telecommunications Corp. and Bahrain Telecommunications Co.--ended their operations in India last year after they lost all their permits. The court Friday directed the government to auction all the remaining spectrum it got back from the revoked licenses, the lawyer said. In November, India had put up for auction 144 out of the 176 blocks freed up after the court order. via Technology - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNHCfBH89ygAnwAPgofZQHFb6Pfy1g&url=http://online.wsj.com/article/SB10001424127887324162304578305671320507036.html

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