It’s always good to have more choices on voice and data services. That’s exactly going to happen in the hyper-competitive telecom market in India.
The Telecom Commission has approved Telecom Regulatory Authority of India’s (TRAI) recommendation on allowing virtual network operators (VNOs) to operate in India. The final node will be given by Telecom Minister, after which a new category of unified licence will be issued.
What are VNO?
Virtual network operators (VNOs) can provide mobile services including voice and data services under their own brands to customers without owning any spectrum or mobile infrastructure. This service provider actually buys voice minutes and data bandwidths in bulk from multiple (or single) telecom operators and then resells them to customers.
Mobile VNOs can be beneficial to current telecom operators as they can monetise unutilised airwaves beside the usual spectrum trading and sharing. Government owned telecom operators BSNL and MTNL have lots of unutilised airwaves which can be now effectively monetised with partnering with a VNO.
On the other hand, telecom operators like Telenor can now expand their presence pan India by going for the VNO route without actually owning any spectrum licence.
- VNOs can offer telecom services under its own brand
- VNOs can offer cheaper voice and data tariff
- Can target niche market segments such as retail, business, roaming, offering specialised services
- Telecom operators can effectively monetize unutilised airwaves
- Telecom operators now own a partner to share their licence fee and spectrum usage charges.
A new category of unified licence for virtual network operators will be issued with an entry fee of Rs 7.5 crore for those who want to offer all telecom services. VNOs can also opt to offer pan-India internet service with an entry fee of Rs 15 lakh and Rs 1.25 crore for a long-distance telecom licence. All licence provided to VNOs will be valid for a period of ten years.