MVNO policy to be out before 3G auction begins

The government expects to come out with the mobile virtual network operator (MVNO) policy by January 5, when the auction of 3G spectrum commences.

Addressing the pre-bid conference for the auction of 3G and BWA spectrum, Department of Telecommunications (DoT) Joint Secretary J S Deepak said, "We are hoping to come out with the policy on MVNO before the end of January 5, which is the deadline for (the) application of 3G spectrum."

He added that a sub-committee of the DoT is looking at it.

As MVNOs do not have spectrum, they operate through commercial arrangements with licensed Mobile Network Operators (MNOs), buying bulk minutes of traffic and reselling them to their own subscribers. Virgin Mobiles is an example operating in India in partnership with Tata Teleservices.

As the government has limited the number of players that will offer services, the MVNO route will prove to be a good option for those looking at capturing a significant share in the world's second-largest telecom market.

Mobile operators had conveyed to the Telecom Regulatory Authority of India (Trai) the need to change the definition of an MVNO to preclude sharing spectrum with MVNOs.

Trai's definition of an MVNO is: "An MVNO licensee is an entity that does not have an assignment of spectrum for Access Services (2G/3G/BWA) but can provide wireless (mobile) Access Services to customers by sharing the spectrum of the Access Provider."

The players had contended that the definition conveys a sense of ownership/co-ownership, which is not true in the case of an MVNO.