A change to a more than century-old law, a welcome step

- New era legislation to mark a new direction for Indian telecom sector: Broad changes proposed in spectrum allocation

The introduction of the Telecommunications Bill 2023 in the Lok Sabha, the Telegraph Act, which is more than a century old, is a welcome development for the sector. The sector is facing financial crisis and dominance of two companies and in such situation it is believed that the proposed new bill will provide relief. The central government has initiated a series of reforms through this bill.

The biggest change in the bill is to make room for allocation of spectrum at administrative cost in the case of satellite broadband services, if required, instead of the universal rule of auctioning spectrum for all telecom platforms. The Supreme Court had ruled in 2012 that a competitive auction process should be adopted for allocation of natural public resources like spectrum. Spectrum is allocated only through bidding process. Along with introducing the bill, the government has also sought clarification from the Supreme Court on whether it can allocate airwaves at administrative cost in cases where competitive bidding is not viable.

The proposed bill aims to replace the Indian Telegraph Act 1885, Indian Wireless Telegraphy Act 1933 and Telegraph Wires (Unlawful Possession) Act 1950 and should help the telecom sector as it will keep intact the powers of the Telecom Regulatory Authority of India i.e. TRAI. This will bring openness in terms of competition in the sector. There will be reforms in terms of spectrum and once the law is passed, the work of telecom companies will become easier. It is gratifying that the bill addresses the issues of all stakeholders - consumers will benefit from stricter regulation against nuisance callers, industry, state governments and the Center will benefit if the proposed online dispute resolution system works effectively.

Apart from this, telecom and tower companies may get support in infrastructure as the bill calls for strict action against those who damage any telecom network or disrupt any service. To give relief to WhatsApp, Skype and other over the top (OTT) services, they have been exempted from telecom regulation. It has been clarified that OTT will be regulated by the Ministry of Electronics and Information Technology. This will put an end to the current ambiguity regarding this area. Government can take over any telecom service or network in case of emergency. It should not be used to stifle free markets or suppress democracy.

Privacy rules and the circumstances under which the government can take over services should be clearly defined with adequate checks and balances. In the near future, those who want to start their own broadband satellite services may benefit, as the bill allows allocation of spectrum in the region at an administrative cost, following global practice.

Among these things, a long-term consideration of this law is necessary. After years of drafting and redrafting, the first comprehensive reform in the telecom sector is indeed a welcome addition to an industry that India needed.