Idea Cellular, one of the original mobile operators had applied for 9 new licenses in 2006, long before the Government took a decision to award licenses in 2008.
The Supreme Court has delivered its judgment on PILs in the matter of telecom licenses granted in 2008, where they had quashed all the 122 telecom licenses issued.
This includes Idea’s above 9 licenses and 4 licenses of erstwhile Spice Communications which stands merged with Idea Cellular. Idea Cellular has rolled out its telecom services in 7 license areas including Tamil Nadu, Kolkata, West Bengal, Orissa, Assam, NESA and Jammu & Kashmir.
The remaining 2 licenses of Idea Cellular and 4 licenses of erstwhile Spice Communications are non-operational. These licenses, as per then stated Government’s “first come first serve” policy, should have been granted to Idea Cellular much earlier than January, 2008. This seems to have been recognized by the Supreme Court as they have not charged us any penalty.
Idea Cellular has unnecessarily been caught in this situation of cancelled licenses, just because the licenses were granted in January, 2008 which was as late as 18 months from the date of application.
In fact, Idea Cellular had filed a Petition in TDSAT inter alia seeking to isolate our application from the 2007/08 applications, and thus requesting for priority under the then DoT policy of “first come first serve”.
It is unfortunate that a serious incumbent operator like Idea Cellular is being made to suffer due to this cancellation of licenses, despite being fully compliant at each stage of the license allocation process. As per information available from the media, we understand that the license holders are allowed to continue operations for the next 4 months and an auction will be conducted for these licenses within this period. We will study in detail the above Supreme Court judgment and explore all possibilities to protect our investment.
Idea Cellular in these 7 service areas currently has over 6 million subscribers. These account for about 5% of Idea’s cumulative Capex, 4% of its revenue, and are EBITDA loss making circles.