Exit Route on the Way for India's Startups

10:00 AM -- The Indian Government is considering various options to provide an exit route for new operators that were awarded licenses in 2008 but are now struggling, according to The Economic Times.

Details of the exit options are currently being worked out by Telecom Commission, the highest decision-making body in India's Communications Ministry.

Earlier this month, reports suggested that Etisalat DB had approached the government, seeking a way to exit the market. But it's not the only startup operator that has encountered tough trading conditions in India's brutally competitive mobile services market. (See Indian Startups Seek Exit.)

Any operator exit policy is likely to be controversial, as was the way in which the licenses were awarded in 2008. Some in the industry allege that the way in which the startup operators were awarded their licenses caused the Indian government to miss out on a potential windfall of 700 billion Indian rupees (US$15.1 billion), the estimated value of the spectrum that was handed out in that round.

In addition to reducing the number of operators -- there are currently 15 -- providing an exit for any struggling startup carriers would also help the government deal more easily with India's current spectrum shortage.

— Gagandeep Kaur, India Editor, Light Reading

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