122 2G telecom licences granted during A Raja's tenure stands cancelled

The apex court bench of Justice G.S. Singhvi and Justice A.K. Ganguly has cancelled 122 2G telecom licences granted during A Raja's tenure.

The companies likely to be affected are:

• Uninor
• Tata teleservices
• Videocon
• Swan telecom
• Idea Cellular
• Loop Telecom

Supreme court also slapped a cost of Rs 5 crore each on Unitech, Swan Telecom and Tata Teleservices and said half of that will go to the court's legal aid services and the remaining to defence services.

Implications of Verdict of Supreme Court in Telecom Sector

• Consolidation is bound to happen as some of the existing players may not participate in the auctions. The existing players may now be able to revise upward their rates. There were not able to do so due to the competition.
• Players like Bharti, Vodafone and others, who did not get the specturum in 2008, are now better positioned as compared to the new players.
• The unused spectrum would now come back into the system and the scarce resource would be put to efficient use.
• The Supreme Court has given four months time to the companies whose licenses have been cancelled to cease operations, allowing ample time for an arrangement to shift users to another service provider.
• The new development may be positive for independent tower companies

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