India’s Department of Telecom (DoT) has issued Show Cause Notices to India’s five private operators, including Bharti Airtel , Vodafone and Reliance Communications, for under reporting revenues. As per a special audit report conducted for the period between 2006 to 2008, gross discrepancies about the actual revenue generated & the one reported, were found. This was allegedly done in order to pay much lower license fees. This has resulted in a loss of over Rs. 1600 Crores (US$ 330 Million) that is now being sought from the TelCos. Communications Minister Mr. Sibal confirmed the same yesterday & his department has put forth a condition to deposit about 1000 Crores immediately & only after that the companies will get to meet the Minister face-to-face to explain their side of the story. Though this feels kind of a dictatorial attitude, the news, if true will have serious bearing for the Telcos who are already reeling under the pressure of the 2G Scam & 3G fiasco . How does the Under-Reporting work? Telecom Companies have multiple Licenses depending on the service they provide. Unified Access Service License (UASL), National Long Distance (NLD), International Long Distance (ILD) and Internet Service Provider ( ISP ). Now, the UASL (basic and mobile) telephony has a license fee in the range of 6 – 10 per cent whereas NLD, ILD, ISP and Internet Protocol has only 6%. Guess, Govt. wants to promote Internet Penetration & this serves as an incentive for the companies. However, all the accused service providers were showing more revenue in segment that carried lower license fee. This operators’ scope to arbitrage of shifting revenue from higher license fee to the lower side has caused a huge los to the exchequer claims DoT. Surprisingly, this complaint was reported way back in 2009. Is our government waking up too soon? Looking For A Social Media Agency?? – Contact WATConsult – India’s Leading Social Media Agency Related Posts To 3G Or Not 3G? Vodafone Wants to Triple Data Services Revenue Private Players Airtel & Vodafone Accused By The CBI In 2G Scam India Is Turning Out To Be An Expensive Affair For Vodafone; £2Bn Investment Still Not Paying Off Recap 2010 : The Great Telecom Saga(s)!


