Telecom sector to come under new licence system

HIMALAYAN NEWS SERVICE

KATHMANDU: The government has decided not to allow telecom service providers to upgrade their services, if they do not come under the unified licence system.

The information published in a gazette on May 15 said that no telecom service provider can upgrade its service without obtaining a licence under the unified licence system. The government wants to make the unified licence system mandatory, said spokesperson at Nepal Telecommunications Authority Kailash Prasad Neupane, adding that the enactment of the unified licence system will bring uniformity in the policy.

The gazette notification has clearly said that no rural telecom service provider and limited mobility operator will be allowed to expand their service areas or even upgrade their technology, he said. “Telecom service providers who refuse to take licence according to the provision of unified licence system will not get permission to operate third generation (3G) and fourth generation (4G) services,” said Neupane.

The unified licence system aims at collecting more revenue from the telecom sector, according to the authority.

“The notification has said that a telecom service provider will have to pay Rs 357.5 million as licence fee and Rs 20.13 billion licence renewal fee,” he said. Telecom service providers must renew their licence every 10 years according to the gazette notification, informed Neupane.

Similarly, the new provision has also stated that telecom service providers should pay two per cent of their income for Rural Telecom Development Fund and four per cent royalty every year.

Currently, there are six telecom service providers in the country. Among them, three –– Nepal Satellite, STM and Smart –– have acquired a licence as rural telecom service providers. Similarly, UTL is operating limited mobility service. Nepal Telecom and Ncell are operating services throughout the country.

However, the licence condition and licence renewal fee and royalty structure varies from one service provider to other. NTA claims the new provision will end the ambiguity in the policy of telecom services. On the other hand, critics said that the new provision is not pragmatic and will bring in more ambiguity in the telecom industry. “The main bone of contention is whether or not the authority will be able to collect billions of rupees from Ncell and Nepal Telecom,” a source at the authority said.