Trai Makes Case for Virtual Network Operators

The Telecom Regulatory Authority of India (Trai) on Friday recommended to the government creation of a virtual network operator (VNO), a new telecom service provider that would work like a reseller for telecom operators and bill directly to customers.

According to the recommendation, a VNO would offer all telecom services permitted under new licences.

"Since VNOs are a new concept in India, initially, the duration of the licence of a VNO should be fixed at 10 years, extendable further for 10 years at a time by the licensor," Trai said.

Depending on technological developments and experience gathered, it added, the duration of licence can be reviewed after a gap of 3-4 years.

A Virtual Network Operator is something like a retailer selling products and services of different companies under one roof, and a customer needs to pay only one bill for all items purchased.

"A VNO will be primarily an operator providing various services to an end consumer by using the underlying network of an NSO (Network Service Operator). Moreover, with the rapid advancement of technology, the business model of a VNO will continuously change," Trai said.

Trai has recommended that VNOs should be allowed to provide services of more than one operator and create their own service delivery platforms in respect of customer service, billing and value-additions.

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Even offering broadband is under the ambit.

Trai has taken the line that the terms and conditions of sharing infrastructure between NSOs like Airtel, Vodafone and BSNL, and a VNO should be left to the market.

The regulator feels that there should be no cap on number of VNOs that can operate in a service area.

Trai also wants a separate category of licence, namely UL (VNO), for such an arrangement.

It suggested that access to services for further sale should be left to the mutual agreement between an NSO and a VNO.

However, Trai or the Department of Telecom (DoT) shall have right to intervene in the matter as and when required to protect the interests of consumers and the telecom sector, the regulator clarified.