Kul Bhushan

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Posted on 23-09-2011

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The Department of Telecommunications (DoT) has rejected US-based chip maker Qualcomm's application for Internet Service Provider license nearly fifteen months after the latter won the Broadband Wireless Access (BWA) spectrum for four circles – Delhi, Mumbai, Kerala and Haryana.

Responding to DoT move, Qualcomm has issued a statement saying, “We received a notice from the Department of Telecommunications on September 21, 2011, informing us that the license to the companies formed with our Indian partners, for use of the spectrum Qualcomm won at last year’s auction, has been rejected on grounds that we find to be baseless.”

“In fact, the application process was fully complied with, and we will continue to work with the Indian authorities to resolve this matter.”

According to reports, the DoT has now referred the matter to the law ministry. If the law ministry rules against issuing the license, Qualcomm could suffer a loss of more than $1 billion, the amount it paid to win the licenses in the four above-mentioned circles. The auction rule stated that if at any stage, the allocation is either “revoked, withdrawn, varied or surrendered”, money will not be refunded.

Qualcomm had won the BWA licenses for four circles in a state-run action held in June last year. Under the auction rules, the company was required to apply for the ISP licenses within three months of the auction. The chip making company claims that it had applied for the license in August, within the deadline. The DoT acknowledges that Qualcomm did apply in August, but adds the company gave a revised application in December and missed the deadline.

If the government decides against giving out the license, the move could further dent the ongoing efforts to bring more foreign players in the country's booming telecom sector. The spectrum allocations have not gone well with the government in the past. The 2G spectrum allocation is already under scrutiny for the alleged financial irregularities. Let us know what's your take on the issue in the comments section below:

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