DoT warns telcos may misuse fixed broadband licence fee exemption; Trai starts review

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Telecom regulator Trai on Wednesday started consultation to re-examine its suggestion to exempt fixed broadband service from licence fee to proliferate digital connectivity across the country.

The move follows concerns raised by the Department of Telecommunications (DoT) on March 12 around likelihood of misuse of the exemption by telecom service providers.

"DoT has raised certain new issues like exemption of the licence fee on the revenues earned from fixedline broadband keeping in view the current factual matrix and relevant issues, likelihood of misuse by the licensees through misappropriation of revenues due to the proposed exemption," Trai said in a statement.

The Telecom Regulatory Authority of India (Trai) issued a supplementary consultation paper on roadmap to promote broadband connectivity and enhanced broadband.

The regulator said the concerns raised by DoT were neither explicitly consulted with the stakeholders in the consultation paper on 'Delivering broadband quickly: What do we need to do?' floated in April 2015. It was consulted in the paper on 'roadmap to promote broadband connectivity and enhanced broadband speed' in August 2020 and therefore, it has started the supplementary consultation.

Trai in 2015 had recommended that the licence fee on the revenues earned on fixed-line broadband should be exempted for at least five years.

Beside misuse of exemption, DoT has asked Trai to give a reference on whether the proliferation of fixed-line broadband services can be better promoted by providing direct benefit to consumers for usage of fixed-line broadband services.

The regulator had also given recommendation on roll-out of 5G services. However, in the supplementary paper, it has invited views on the use of street furniture for the roll-out of 5G networks.

Trai fixed June 3 as the last date for public comments on the consultation paper and June 10 for counter comments.