On 8th Aug 2023, the TRAI recommended the creation of a new category of license (DCIP) that is aimed at allowing the Infrastructure Providers (IP1s) to roll out both active and passive infrastructure at 0% license fees. As of date, the IP1s are only allowed to roll out passive infrastructure and that too after going through a registration process. All other categories of licenses in India mandate some form of fee, which is nothing but a % of the licensee’s revenues to be paid to the DOT as license fees. Fortunately, the IP1s are excluded from this obligation. The purpose of this note is to discuss why DOT was able to create such a distinction, what were its inadvertent benefits, and what is the probability that this time DOT will finally agree to the TRAI (it had made similar recommendations in the past) and allow rolling out active elements without having to pay any license fees.
Why IP1s were excluded from licensing?
The key reason is clause 4(1) of the Indian Telegraph Act 1885, reproduced below for ready reference.
