Guidelines for opening up STD services

By Sandeep Dikshit

NEW DELHI, AUG. 11. In a move aimed to attract foreign investment in the telecom sector, the Government has finalised a set of guidelines for opening up the national long distance service (STD) to private operators. A formal announcement is expected to take place this weekend, said official sources.

It also finalised the guidelines for allowing internet service providers to set up submarine cable landing stations in order to increase the availability of international bandwidth in the country. The Government expects this announcement to give a major boost to the growth of internet as the problem of speed and congestion while accessing internet will no longer be stumbling blocks.

According to the guidelines for issuing licences for national long distance communications, there will be no limit on the number of companies but each applicant will have to pay a one- time entry fee of Rs. 500 crores of which Rs. 400 crores will be refunded in phases after the company has established its point of presence (PoP) in all parts of the country including the non- remunerative eastern region. Making a technical change, the guidelines stipulate that the PoP will be for long distance charging areas (LDCAs) instead of district level short distance charging areas (SDCAs).

The licences will be valid for 20 years extendable by 10 years for inter-circle long distance operations. But intra- circle traffic can be carried with mutual agreement of the fixed service provider from and to a mutually agreed point. Earlier, the Telecom Commission was in favour of barring companies from carrying intra-circle traffic. Following protests from companies who had claimed that this stipulation will discourage them from entering the long distance sector as most long distance calls take place within telecom circles.

Apart from the one-time entry fees, companies will have to pay revenue share of 15 per cent to the Government. This includes five per cent as contribution to the proposed universal social obligation (USO) fund which will be utilised for providing phones to low income and rural phone subscribers.

The guidelines also include several eligibility criteria to keep out fly-by-night operators. The applicant should have a paid up equity capital of Rs. 250 crores and all its members should have a combined networth of Rs. 2,500 crores. The networth of only those promoters will be counted who have at least 10 per cent stake in the company.

With regard to the guideline for landing stations for international gateways for internet, the Government has decided not to give permission in security sensitive areas. In these areas, internet nodes covering places of security importance will be routed only through VSNL.

The security sensitive areas identified by the Government are coastal areas of Tamil Nadu (except Chennai) and Gujarat, Jammu and Kashmir, North-Eastern States, border areas of Rajasthan, Punjab and Andaman and Nicobar islands.

The Government has clarified that the ISP licensee who sets up the landing station cannot claim any right nor will he get a special preference for carrying voice traffic whenever the sector is opened up for private participation.

The companies must also allow agencies authorised by the Government to monitor all types of traffic passing through the landing terminals. Each of the security agencies must be provided with a specified dedicated storage in the monitoring centre computer.

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Section  : National
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