The new Indian Telecommunications Act, 2023 was passed by Parliament in December 2023. The new act replaces the Indian Telegraph Act, 1885 and the Indian Wireless Telegraphy Act, 1933. The repealed laws were enacted way back in history when communication technology was in its infancy.
The concept of communication devices such as the smartphone (or the mobile phone for that matter), the internet, platforms such as social media, television, radio and audio-visual content riding on those technologies, did not exist. Nor was there private participation, competition or regulation anywhere on the horizon, with the government being the monopoly provider of services.
The past two decades have seen technology evolving at bewildering speeds, and it is inevitable for legislation to catch up. There has been enormous litigation centred on matters such as the policy for spectrum allocation, licensing, content regulation, monitoring of communications for security, and protection of the citizen’s right to privacy.
All of these come into the picture because the sector is of enormous economic importance and it has large positive externalities. Entire industries such as IT, entertainment, banking and logistics are completely dependent on it. So are a host of consumer-facing businesses, as well as industrial units and manufacturing infrastructure. The government increasingly provides digital services as well, and the vision of Digital India depends on smooth, seamless, affordable telecommunication across the country. The new act makes some changes that will alter industry dynamics. These include:
Ensuring technology neutrality: The centre can facilitate spectrum utilisation in a flexible, technologically neutral manner. This may foster a level playing field for different technologies.
Facilitating R&D: The act provides for regulatory sandboxes, test beds, etc. The government can administratively assign spectrum for scientific research, satellite communication, national security, disaster management, and testing for emerging technologies. This will encourage innovation since it allows for testing new concepts in controlled environments, granting exemptions, allowances or time-bound exceptions.
Reducing spam: Spam is a permanent irritant. The act empowers the government to prescribe measures for protecting users. The recommended measures include obtaining prior consent, preparation and maintenance of “Do Not Disturb” registers, and mechanisms to report malware and unsolicited messages.
Simplifying right-of-way (RoW) approvals: The act clears regulatory barriers for RoW in private properties and urges all public entities to grant permission quickly, within prescribed timelines. Rejection of an application by a public entity requires reasonable grounds. This will significantly accelerate fibre induction and improve quality of service (QoS).
Granting the right to intercept: In the interest of public emergency and public safety, the new act gives broad discretion to the government to intercept and monitor messages or a class of messages. This may impact privacy, so it is extremely important to put in place checks and balances to prevent any misuse of these provisions.
Allowing the right to suspend services: Section 20(2)(b) of the telecom act, allows the state to suspend telecommunication services in the interest of public safety or sovereignty “in such manner as it may be prescribed”. The lack of an explicit threshold for such suspensions raises concerns about potential misuse, particularly since India is already infamous for the number of internet shutdowns. Again, checks and balances need to be built into this.
The new act does clarify some of the ambiguities centred on the distinction between the telecommunications network and the content and application services (CAPS) it supports–the so-called over-the-top (OTT) services. An earlier draft contained an all-encompassing definition of telecommunications services, which extended to OTT content and applications. That led to fears that OTT players would require a licence or authorisation to operate. The act removes this explicit reference to OTT services, even though some confusion remains.
Importantly, the new act clarifies the process and policy of spectrum allocation. Earlier attempts failed to fully anticipate the diverse scenarios of spectrum use for telecommunications, for example in access, backhaul and satellite communications. The earlier draft raised the prospect of auctioning satellite spectrum, an approach that is globally considered inappropriate and inefficient since satellite players do not need spectrum for exclusive use. The new act allows for a more nuanced approach based on the specifics of the technology and usage. It allows for different methods of allocation based on the intended use of the spectrum.
The administrative allocation of spectrum for satellite broadband services is pragmatic, aligning India with global norms and fostering competition for improved connectivity in underserved regions. The replacement of the Universal Service Obligation Fund with “Digital Bharat Nidhi” is also forward-thinking, broadening the scope for investing in research and development, which may support India’s contribution to emerging technologies such as 6G and edge cloud.
While acknowledging the positives, the act does have certain areas that need attention. Future amendments, through mutual consultation, can address issues such as the regulatory status of OTT apps, align exemptions to government interception of encrypted messages with constitutional privacy rights, and clearly define national security issues that may trigger government takeover or suspension of telecom networks.