Department of Telecom note says Qualcomm licence rejected

The Department of Telecom (DoT) has said Qualcomm Inc, the San Diego-based telecommunication chips giant, has violated norms regarding internet service provider (ISP) licence after winning the auction for broadband wireless access (BWA) spectrum in June last year.

According to a letter written by DoT to Qualcomm Inc earlier this month, a copy of which is with DNA, the US major’s ISP licence had been “rejected” as it had slipped on two counts.
First, its application for service licence came after the deadline — three months after being issued the letter of intent (LoI).

Second, it nominated four companies instead of one for the ISP licence.

“In view of above (breach of Notice Inviting Application (NIA) norms), your request for grant of ISP licence(s) to your nominee companies for provisioning of ISP Services through BWA under the ISP licence cannot be considered and is rejected,” says the letter signed by Ritu Pande, director (DS-III), DoT.

As per the letter, the sticking point was clearly that Qualcomm had gone against the NIA rule for auction of 3G and BWA spectrum, which states “the successful bidder was required to apply for/or otherwise acquire the relevant service licence within three months of being declared a successful bidder, failing which the government shall have the right to revoke the spectrum.”

“It is noted that you have submitted the names of you nominee companies for obtaining ISP licence to WPC wing of DoT only on December 20 (2010), which is beyond the validity period for applying or otherwise acquiring relevant licence as stipulated,” Pande wrote in her letter.

“Further as per the NIA and LoI for earmarking of BWA spectrum, issued to you by WPC wing, DoT, the successful bidder, who is prospective new entrant, can nominate only one nominee company for obtaining a Category A all India ISP licence. However, you have nominated four companies, namely Wireless Broadband Business Services (Delhi) Pvt Ltd, Wireless Broadband Business Services Pvt Ltd, Wireless Broadband Services (Kerala) Pvt Ltd and Wireless Broadband Business Services (Haryana) Pvt Ltd for obtaining four different Category A All India ISP licence(s) for provision of ISP services,” she stated in the letter.

Qualcomm denied receiving such a letter from the DoT. “We have received no such letter yet,” a spokesperson said.

Pande, however, confirmed to DNA she had written the letter to Qualcomm.

Qualcomm said it is “in full compliance with the regulatory requirements (of the DoT).”  The US major clarified that it had directed its “nominee companies to obtain ISP licence within 90 days as per the provision of the NIA.”

“Our nominees companies (locally incorporated) applied for ISP licences on August 9. DoT seems to be having an interpretation that Qualcomm Inc should have introduced these nominee companies first before they applied for an ISP licence. The NIA, however, does not have any such clause which required Qualcomm Inc to do so,” clarified Qualcomm in its reply to DNA’s queries.

“Also DoT’s first letter seeking clarifications from these companies seeking licence was issued only after the expiry of the window period of 90 days, i.e, on November 30, 2010. In which, DoT, as a routine procedure, asked these four companies to submit proof of them being Qualcomm’s nominees, which Qualcomm Inc responded vide a letter dated December 20, 2010. Hence, we believe that we are in full compliance with the regulatory requirements,” it further said.

And as the two parties slug it out, consumers are losing out on cheaper and faster wireless broadband services.

Qualcomm said since its participation in the BWA spectrum auctions, it has been systematically empowering and strengthening the BWA and LTE ecosystem through India specific multimode devices capable of working across heterogeneous networks.

“Multiple trials were conducted along with our partners and have been extremely successful. Any further delay in award of licence will deprive the Indian consumers in realising these benefits, thereby severely impacting India’s broadband plans,” the company said.