80 companies apply to be virtual telcos

NEW DELHI: The government has received request from 80 companies for mobile virtual network operator ( MVNO) licence, which will enable them to offer telecom services by buying airtime and bandwidth from existing operators.

Sources told TOI that 70 companies have expressed interest in procuring MVNO licence at the district-level as they plan to offer localised services, while 10 have applied for national-level licence."We are enthused by the response to the MVNO services. Future group and Datawind are among the companies that have applied for the licence," the sources said.

A source said that MVNO licences could be issued over the next few months, or even earlier, and will ensure greater competition in the tele com sector, while offering more choices to consumers.

Names of other companies that have applied for the MVNO licence could not be immediately obtained.

Under MVNO, companies buy airtime and bandwidth (for calls and data) in bulk from existing operators and then offer services under their brand. Companies saddled with excess spectrum in various circles can tie up with those entering MVNO business, thus earning revenue on the bandwidth.

On March 28, the inter-ministerial telecom commission had given its approval to MVNOs, a model that exists in the US and Europe. Compani es from various sectors (such as telecom, retail, banks or air ine players) hope to use it to gain an easy entry into India.

"The MVNO route can provide a good option for companies in suburban or rural areas where customers are underserved. While top opera ors face bandwidth crunch and may not warm up to the dea, there are smaller players and PSUs which have large in rastructure but lack marke ing capacities with unused spectrum in their possession," said Rishi Tejpal, a research analyst at Gartner. The cut-throat mobile and data tariffs in India, however, may not make it easy for MVNO players, analysts said.