TRAI told to clarify revenue impact of landline licence waiver

Inter-ministerial panel Telecom Commission on Tuesday asked TRAI to explain possible impact on revenue to the government from the regulator's proposal to exempt fixed line broadband services from licence fee.

"TRAI's recommendation on broadband (Delivering Broadband Quickly...) was discussed by the Telecom Commission today," Telecom Secretary Rakesh Garg said without disclosing details of decision taken.

The panel has sought clarifications from the Telecom Regulatory Authority of India (TRAI) after which final decision on the matter is likely to be taken by the Cabinet.

The regulator in April had said "...to promote fixed line BB (broadband), the license fee on the revenues earned on fixed line BB should be exempted for at least five years." As per TRAI, the cost of installation and maintenance of a fixed line is much higher than mobile telephony, there is a need to create incentives for telecom to invest in the fixed line business.

Official sources said that the telecom commission only discussed TRAI's recommendation on broadband and focused on road map that can be adopted for exempting landline broadband and other services as recommended by the regulator.

"Major concern was on revenue impact that this recommendation would have if fixed lines broadband are exempted from licence fee.

"In coming days broadband would form major part of revenue and voice will come as addition. There were concern if telecom operators started providing all telecom services in one package of fixed line broadband," a source said.