telecom: To connect telecom to the 21st century

GoI‘s attempt to contemporise and consolidate telecommunications laws stretching back to the 19th century is a welcome development for the evolution of a core sector of the 21st century. The legal underpinnings had become frayed but were kept alive through a patchwork of amendments in response to the technological changes in telecom. It is time India moved away from ad-hoc legislation that has affected the investment scenario for the backbone of its digital economy. The Telecommunications Bill, 2022, is a component of the overall digital regulatory framework in the making, which dilutes some of the criticism it has faced about overreach. Telecom minister Ashwini Vaishnaw has clarified the draft Bill seeks to regulate communications services provided by OTT players to protect users on the lines permitted by existing laws and court rulings on interception. It also seeks to level the field on revealed identity of callers across voice and data platforms.

Since the intent of regulating OTT players is not based on telecom companies’ revenue loss considerations, the change is forward-looking. And by not imposing decryption requirements faced by telcos, it is unlikely to stifle innovation in value-added services. The other contentious point in the draft Bill is making auctions the default method of allocating spectrum and narrowing the field of exceptions to this rule. This has set off alarm among newer segments of the sector, like satellite broadband communications, that are relying on administered spectrum to acquire scale. There are several ways to provide incentives to emerging technology without distorting the market for radio airwaves.

But the case for lowering the independence of the Telecom Regulatory Authority of India (Trai) flies in the face of the new regulatory structure’s market orientation. If Trai functions efficiently, GoI has a weak case for giving itself overriding powers over fees and fines. This provision is out of place and is borne out by the poor experience of GoI trying to make markets more efficient.