In the government's court

BS OPINION

While both the cellular and WiLL-mobile players have claimed victory following the Telecom Dispute Settlement Appellate Tribunal's (TDSAT) split judgement, the verdict represents more than anything else an indictment of the government.

Mr Justice D.P. Wadhwa, the chief of the three-member tribunal and the man who wrote the dissenting judgement, has gone so far as to term the granting of WiLL facilities as illegal. The other two members, while asserting that WiLL services are legal, have also been harsh on the government.

Indeed, they say that WiLL services are an 'enormous value added service' and that the reasons given by the Telecom Regulatory Authority of India (Trai) for not recommending any additional licence fee don't stand scrutiny.

The TDSAT chairman lambasts the government and accuses it of witholding information from the ministerial Group on Telecom and Information Technology (GoT-IT), set up specifically to debate WiLL services; he refers to a letter written by the department of telecom to the cellular industry on September 17, 1999 which categorically states that WiLL services are not permissible under the New Telecom Policy (NTP) of 1999.

It is only after this letter was received that the cellular industry paid up its dues in a deal that shifted them from fixed licence fees to a percentage of revenue. The other two TDSAT members also refer to this letter that was withheld from the GoT-IT, but state that it was issued without the concurrence of the minister in charge! Even if one accepts this farfetched explanation, it reflects very poorly indeed on the government.

The judgement, though it has taken so long in coming, does little to reduce litigation. The majority judgement, while asserting that WiLL services are legal, says the service has to be genuinely 'limited', and that it can be used only within a short-distance charging area (or SDCA), which means you can't take your Delhi WiLL-phone to Mumbai, or even from one end of Madhya Pradesh to the other, and expect to be able to use the same connection and number there "" the facility currently offered by both Reliance India Mobile and Tata Indicom.

It also says that the mobile switching architecture (that allows this roaming from any one of India's 2,600 SDCAs to another) is expressly not permitted. But this is precisely what the cellular operators have been complaining about to the government for the past two years, without getting a receptive ear.

And since the WiLL-phone companies are saying the judgement does not affect their operations the way they are today, clearly the litigation isn't about to end.

The issue of compensation, similarly, is going to be a tricky one, with the cellular industry insisting it has to be compensated for having paid Rs 3,000 crore as licence fees, while the WiLL industry is likely to use the figure of around Rs 1,600 crore paid by those who bid for the fourth cellular licence as the reference price.

In which case, as suggested by the telecom minister, Arun Shourie, are unified licences the solution? The answer is yes, but the vital issue remains that of compensation "" and this is more so now, since TDSAT has clearly said all-India roaming WiLL services are not to be allowed.

While Trai can still go ahead with its consultation over a unified licence, what's critical to its success is the government's and the regulator's ability to demonstrate its bona fides, in ensuring that WiLL services do not spill outside each SDCA, and if they are to be allowed, then in setting compensation levels for the cellular industry and fixing equitable licence fees for all. The ball is therefore in the government's court.

And unilaterally changing policy (in the form of a unified licence) won't help, since as Justice Wadhwa's has made clear, the government does not have the right to single-handedly change the conditions of a contract with someone else.

You need mutual consent. The record of the last three years makes it clear that it is time the government listened for a change to what the cellular industry is saying, instead of trying to ram things down its throat.