The telecom licensing framework in India has witnessed significant evolution over the years, driven by technological progress and a growing need for regulatory reforms. These changes have reshaped the way communication services are delivered and consumed across the country.
The Telecom Regulatory Authority of India (TRAI) has recently released its recommendations aimed at streamlining the licensing framework under the Telecommunications Act, 2023. The key focus of these recommendations is to establish a more concise and efficient authorisation process, advocating for a unified authorisation mechanism that reduces complexities and fosters growth in the sector. These reforms are expected to further enhance the ease of doing business and boost innovation within India’s dynamic telecom industry.
The salient features of these recommendations are…
Granting authorisations
The Telecommunications Act, 2023, defines “authorisation” as the permission granted to provide telecommunication services, establish, operate, maintain or expand telecommunication networks and possess radio equipment. However, several stakeholders have expressed concerns regarding the need for safeguards within the authorisation framework to protect the legitimate interests of authorised entities. A key issue is the need for regulatory stability, specifically, protection against potential unilateral amendments in the future. Moreover, given the capital-intensive nature of the telecom sector, ensuring regulatory stability is crucial for its orderly growth. To this end, TRAI has recommended that the central government should grant service authorisation directly under the Telecommunications Act, 2023, rather than through an agreement with the entity. The authorisation should be a concise document that outlines the essential elements of the service, with its terms and conditions to be defined through the rules set under the act.
Categorisation of authorisations
TRAI has recommended three broad categories of telecommunication service authorisations:
Main service authorisations
TRAI has recommended that the Telecommunications (Main Service Authorisations) Rules should define the terms and conditions for services such as access service, internet service, long-distance service, satellite-based telecommunication service and machine-to-machine (M2M) wireless wide area network (WAN) service. Under this category, service authorisations can be granted either as a network service operator (NSO) or a virtual network operator (VNO).
Particularly, entities with an NSO authorisation can deploy a full-scale network and provide services within the scope of their authorisation. Meanwhile, VNO authorisation allows entities to offer services by leveraging the network infrastructure of their parent NSO. Further, TRAI has recommended that for each main service authorisation, there should be an option to provide services as a VNO.
Auxiliary service authorisations
This category covers auxiliary services that typically cater to enterprise users rather than the public and are subject to light regulatory oversight. These include services like public mobile radio trunk service (PMRTS), PM-WANI, M2M services, wireless personal area network (WPAN)/wireless local area network (WLAN) connectivity, enterprise communication services, in-flight and maritime connectivity, and data communication between aircraft and ground stations. Each auxiliary service authorisation will have its own set of terms and conditions, which will be defined through separate rules for each service type.
Captive service authorisations
Captive service authorisations apply to entities establishing captive networks after obtaining spectrum assignments from the government. These include services such as captive mobile radio trunking service, captive non-public network, captive very small aperture terminal (VSAT) closed user group (CUG), and others. Similar to auxiliary services, each captive service authorisation will be governed by distinct terms and conditions prescribed through specific rules for each type of service. This framework ensures that the diverse needs of both public and private telecommunications networks are met through tailored regulatory approaches.
Additionally, TRAI advocates that no entity should hold more than one service authorisation for the same service within a given area. This approach is expected to streamline industry processes by consolidating multiple licences and permissions, leading to improved management, enhanced operational efficiency and a reduction in regulatory compliance burdens.
One Nation – One Authorisation
Until 2012, India’s telecom licensing regime required separate licences for different services, such as access service, national long distance (NLD) service, international long distance (ILD) service, internet service and PMRTS. However, in April 2012, TRAI recommended a shift to the unified licensing framework, enabling the migration of existing licences under the Department of Telecommunications.
Building on this, in 2024, an advanced framework has been introduced, known as the unified service authorisation. This framework is designed to embody the vision of “One Nation – One Authorisation”, simplifying the licensing process across services and geographical areas. Under this new structure, a single authorisation enables an entity to offer a comprehensive range of services, including mobile, internet, broadband, landline, long-distance, satellite communications, M2M and internet of things services, on a nationwide basis. Moreover, entities now have full flexibility in routing domestic traffic, ensuring a more efficient and seamless service delivery model across the country.
The unified service authorised entity is permitted to deploy equipment anywhere in India, provided that lawful interception, monitoring facilities and disaster management connectivity are maintained. Further, they are currently allowed to continue receiving access spectrum, backhaul spectrum and numbering resources at the telecom circle or metro level.
To fully capitalise on the benefits of unified service authorisation, TRAI has recommended that the government should create a road map for establishing a true pan-Indian network capable of delivering various telecommunication services. This road map should guide the progression towards unified financial accounting and reporting.
Streamlining the process
TRAI has introduced key recommendations under the Telecommunications Act, 2023, aimed at streamlining telecommunication services through the consolidation of various authorisations. One major proposal is the merging of NLD and ILD service authorisations into a single long-distance service authorisation. This unified authorisation will cover the establishment of cable landing stations for submarine cables, providing services for both national and international long-distance communication.
In addition, a new authorisation named “satellite-based telecommunication service authorisation” has been proposed for commercial satellite services, merging the erstwhile VSAT-CUG service and global mobile personal communications by satellite licenses. The restrictions on VSAT operators which previously limited them to serving only closed user groups have been lifted under this new framework, enabling greater flexibility for satellite-based services. Moreover, satellite telecom providers will now have the option to use satellite earth station gateways in India to deliver services to foreign countries, with approval from the government. Additionally, the provision of emergency SOS messaging services via satellite will continue to be covered under this authorisation.
TRAI has also recommended merging the M2MSP registration and WPAN/WLAN connectivity provider registration into a single M2M service and WPAN/WLAN connectivity service authorisation. This consolidation will enable a unified approach to managing M2M communication and wireless network services, addressing the growing demand for connected devices and smart technologies across various sectors.
Enhancing the scope
Under the current licensing framework, an internet service authorisation holder is allowed to deploy its own transmission links within its service area for internal use. However, it is restricted from selling domestic bandwidth, such as domestic leased circuits or virtual private networks (VPNs), to third parties.
Thus, the new authorisation framework has expanded the scope of internet service authorisation to include the provision of leased lines and VPNs. This change will enable ISPs to more effectively utilise and monetise their network resources. Additionally, the use of non-terrestrial networks has now been incorporated into the scope of access services, further broadening the services available under this framework.
Easing the financial burden
To ease the financial burden on existing and new telecom players, particularly VNOs, TRAI has proposed the elimination of entry fees during authorisation renewals. This step is intended to promote smoother operations, attract new service providers, drive fresh investments, enhance competition in the telecom market and encourage innovation within the sector.
Stance on OTT services
Notably, TRAI has decided not to bring over-the-top (OTT) services under the licensing framework, despite calls from telecom companies for a “same service, same rules” approach. However, according to TRAI, a consultation paper for OTT services is currently under review.
Industry feedback
The industry has broadly welcomed TRAI’s recommendations. However, telcos raised concerns that the elimination of their licences could create regulatory uncertainty and negatively impact investor confidence. In response, TRAI clarified that telcos can continue operating under the current licensing regime until the expiration of their licences, at which point they will be required to pay a renewal fee.
In sum, the proposed changes are expected to enhance service quality, promote competitive tariffs, expand availability in remote areas and bolster emergency services via satellite systems. s
Niha
