From licence to authorisation — Rewiring a 140-year-old house without switching off the lights

“The most dangerous phrase in the language is, ‘We’ve always done it this way.’” The warning belongs to Rear Admiral Grace Hopper, the pioneering computer scientist of the United States Navy, who spent a lifetime persuading large institutions that habit is not the same thing as wisdom. Indian telecom regulation, one might gently submit, had been doing it this way — more or less — since 1885.

On 23 June 2026, that changed. The Department of Telecommunications notified the much-awaited rules for authorisation for provision of telecommunication services under the Telecommunications Act, 2023, together with companion rules for migration of existing licences to the new regime. The Telecom eServices Portal opened for applications, and a sector that had been waiting at the doorstep since November 2025 finally heard the latch lift. One could ask what truly changes when a licence becomes an authorisation — is it not merely a new nameplate on the same old door? However, as is so often the case in regulation, the nameplate is the smallest part of the story, and the story here deserves to be told room by room.

Indian telecom has, in a manner of speaking, been living in a house whose foundations were laid in 1885. The Indian Telegraph Act, later joined by the Indian Wireless Telegraphy Act of 1933, gave us walls sturdy enough to last fourteen decades, and successive generations kept adding rooms — a licence here, a registration there, a permission above and a no objection certificate below — until the corridors connected awkwardly and the wiring ran in layers that no single electrician fully understood. What the DoT has now undertaken is not a fresh coat of paint. It is a rewiring of the entire house, attempted without switching off the lights, while well over a billion residents continue to live, learn, transact and veritably breathe inside it.

The old wiring — A hundred and forty years of add-ons
Under the erstwhile framework, each family of services demanded its own instrument — Unified Licence, Unified Licence (VNO), standalone licences, registrations, permissions and no objection certificates — each with its own conditions, fees, timelines and compliance calendars. The system worked the way old wiring works: adequately, expensively, and with an ever-present anxiety about what might trip next.

There is a quiet irony here worth savouring. On 14 July 2013, Indians thronged telegraph offices one last time — many sending souvenir telegrams to their own addresses — as BSNL transmitted the country’s final telegram and retired a service that had run for over 160 years. The telegraph died that evening; the Telegraph Act did not. The statute outlived its own namesake by more than a decade, going on to govern smartphones, submarine cables and satellite constellations that its Victorian drafters could not have dreamt of. Conversely, the drafters of Telecommunication Act 2023 knew and announced it had to be followed and detailed with the rules. DoT paused acceptance of new applications with effect from 10 November 2025, pending the new framework. For eight months, aspirants stood at the gate with plans in hand; the 23 June 2026 notification lifts that freeze.

The new floor plan — What the rules actually build
The Telecommunications (Authorisation for Provision of Principal Telecommunication Services) Rules, 2026 organise the core commercial services into five categories — unified service, access service, wireline access service, internet service and long distance service — with applicants entering either as Network Service Operators or as Virtual Network Operators or both. Companion rules for captive and miscellaneous services complete the service architecture. Authorisations run up to twenty years; entry fees at the national level range between INR 10 lakh and INR 12 crore for NSOs, and INR 3 crore for VNOs; minimum net worth is INR 25 crore for a unified service operator (NSO) and INR 10 crore for a VNO. The wireline access authorisation, available exclusively to VNOs, is a thoughtful new doorway for fixed-line broadband without the full weight of an access service authorisation. And the entire journey — application, processing, grant, migration — runs through a single digital window on the principle of digital by design.

Credit is also due for industry wide consultations, way more than just ritualistic. Between the September 2025 drafts and the final text, the government dropped the prohibited-investor disqualification, allowed a VNO to parent with multiple network operators for all services except wireless access service, and permitted submarine line terminal equipment at cable landing points of presence — a long-standing industry request finally granted but such benefit yet to be extended to existing eligible licensed entities.

Old locks, new keys — What has genuinely changed, and what has merely moved
An honest comparison with the Unified Licence regime reveals a handful of genuine improvements and a fair amount of rearranged furniture. Genuinely new is the statutory foundation: authorisations flow from an Act of 2023 rather than a colonial statute. A second substantive development is the consolidation and expansion of service categories within the principal authorisation framework, bringing a wider range of telecom services under a common regulatory umbrella and creating opportunities for greater competition and market participation. The Rules also introduce a notable facilitative measure through broad infrastructure-sharing provisions, enabling the sharing of submarine cable systems and associated telecom network infrastructure among Authorised Entities and Licensees. This is expected to promote more efficient utilisation of capital-intensive assets, enhance network resilience, reduce infrastructure costs and improve capacity utilisation, while preserving the authorisation holder’s responsibility for regulatory compliance and maintaining governmental oversight and security safeguards for critical infrastructure and core network elements. Another important change is the migration of legacy registrations and licences that previously operated without a fixed validity period. Such entities will now be required to transition to the authorisation framework within prescribed timelines and become subject to defined validity periods, renewal requirements, and the broader compliance obligations applicable to authorised entities. And finally, the introduction of a single-window, fully digital authorisation grant process replacing counters and couriers which is procedural rather than substantive change, but nonetheless important step towards a more efficient, transparent, and user-friendly authorisation regime.

What has moved rather than changed is also worth naming. The Authorisation Fee (formerly the License Fee) remains unchanged at 8% of adjusted gross revenue. Security-related obligations including lawful interception monitoring and national security compliance requirements continue to be extensive, now require separate compliance demonstrable for each State or Union Territory, with suspension as the consequence of default. Authorisation Guarantee requirements have been restructured, with entities given the option of furnishing a bank guarantee, a performance bond, or a non-interest-bearing cash deposit. Cross-holding restrictions persist in a revised form: an entity holding access spectrum or a principal service authorisation cannot hold beneficial interest beyond ten percent in another authorised entity in the same category. KYC and traceability requirements, particularly for business customers and its end users, have also become more onerous, adding to the compliance burden.

Movers and packers — Migration by choice, and the two-house problem
Migration to the new regime is an invitation, not an eviction notice: existing licensees may continue under their licences until expiry or migrate through the separately notified migration rules, however, at the time of migration, legacy liabilities and all past dues shall have to be cleared. The arithmetic in each boardroom will be its own — treatment of guarantees, continuity of spectrum and clearances, compliance costs and conditions, and the ongoing disputes. The sector has moved houses before, from fixed licence fees to revenue share in 1999 and into the Unified Licence from 2013, and each time the terms of transition mattered more than the destination.

Yet the very gentleness of this design creates what one might call the two-house problem. For years, possibly a decade, migrated and non-migrated operators will compete in the same market under two different rulebooks — license and authorisations. Predictably and justifiably, every operator will compute which house is cheaper to live in, and regulatory arbitrage of this kind is a loophole not of anyone’s liking. The DoT would do well to publish a clear equivalence map, so that the choice to migrate is made on merit.

The gaps in the plaster — Grey areas an honest surveyor must flag
A deep analysis must name the soft spots, and there are a few. First, the eligibility test asking whether the general character of an applicant’s management is “sound”, based on its track record of responsibly providing telecom services, is undefined — and an undefined test can be a barrier to a genuine newcomer and an open door to a persuasive incumbent. Second, the government may exempt any applicant from any condition in public interest; used sparingly this is flexibility, used generously it becomes a bespoke regime negotiated case by case. Third, the single window is not yet a single permission: satellite networks, spectrum assignment and gateway approvals continue to require separate government clearances, so the applicant with the most modern business model still walks the longest corridor. Fourth, TRAI had recommended separate authorisations for satellite-based and M2M services, and further that substantive changes to authorisation conditions should route through TRAI’s recommendations; the final rules have taken a different path, and since these are subordinate legislation, conditions can be amended by notification — a flexibility that investors, who price predictability above almost everything, will watch carefully. Finally, the expanded data localisation mandate — network data may not be routed, shared or made available outside India, including through copies — sits somewhat sternly beside the more calibrated cross-border posture of the Digital Personal Data Protection Act, 2023, and the two philosophies will eventually need to be reconciled for operators who must comply with both.

The neighbours’ houses — How the world authorises
It is instructive, and humbling, to peer over the compound wall. The European Union has operated a “general authorisation” regime for two decades under which providing networks and services requires, at most, a notification — no prior permission, no entry fee negotiation — and its proposed Digital Networks Act goes further, contemplating a single passport whereby one notification in one member state permits operation across the Union. The United Kingdom abolished individual telecom licences as far back as 2003 in favour of general conditions applicable to all. The United States runs a patchwork — spectrum licences and carrier authorisations — but leaves internet service provision largely outside licensing altogether. At the other end, China administers a tightly state-controlled licensing system, while many developing economies — Nigeria and Kenya among the earlier movers — adopted unified or converged licensing in the 2000s to escape exactly the instrument-per-service maze of India.

Where does India’s new regime sit on this street? Somewhere distinctive. It is more consolidated than the developing-economy norm, considerably more conditional than Europe’s notification model. It is more sovereignty focussed than many — with localisation, interception readiness and citizenship-linked governance conditions built into the entry document itself. India has, in effect, designed a third way: liberal at the gate, vigilant inside the house. For large developing economies balancing digital growth against security anxieties, this hybrid may well become a template worth studying, and that is a uniqueness worth acknowledging even while we debate its costs. An authorisation regime is, after all, a mirror: its entry conditions reflect what a nation hopes for, and its operating conditions reflect what it fears. India’s new rules hope for investment, innovation and inclusion; they fear for security and sovereignty; and the rules carry both.

Other houses on our street — What other sectors can teach us
Telecom is not the first Indian sector to renovate. The Electricity Act, 2003 delicensed power generation altogether, and the investment that followed transformed the country’s capacity story — proof that lowering the gate can raise the roof. Banking moved to on-tap licensing in 2016, replacing episodic windows with a standing invitation, which is philosophically what a twenty-year authorisation with defined eligibility attempts. Closest to home, the DoT’s own liberalisation of the Other Service Provider regime in 2020-21 — removing registration requirements, bank guarantees and reporting for BPO and ITeS players — was followed by a visible boom in global capability centres, demonstrating that trust, once extended, tends to be repaid with growth. Broadcasting, meanwhile, still awaits its own 1885 moment, and the unfinished business of telecom-broadcast convergence means the corridor between these two houses remains bricked up even as technology has long since dissolved the wall.

The sitting tenants — What the rules mean for those already inside
For the existing players, the pros and cons are getting analysed : the formalisation of exclusion of non-telecom revenue from adjusted gross revenue removes the sector’s single largest source of audit anxiety and litigation overhead; shareholding reporting has been narrowed to acquisitions and, for listed entities, to changes already disclosable under SEBI takeover regulations — removing duplication of reporting; the fixed half-yearly reporting cycle for trusted-source compliance gives way to portal-driven dates; and the paper-bound counter is replaced by a digital window. These are genuine reductions in the cost of being regulated, costs which would compound quietly year after year.

On the other hand, the costs are fewer in number but heavier in kind. Operators must now deploy AI and big data analytics for fraud prevention and implement anti-spoofing measures. Lawful interception must be demonstrable separately for each State or Union Territory. The localisation requirements are made bigger, mandate obliges those with global network operations centres and offshore support models — to ring-fence India infrastructure and re-engineer arrangements built over decades.

The welcome mat — What now invites the newcomer, and the sector’s growth arithmetic
For the aspirant at the gate, Entry fees at the national level sit between INR 10 lakh and INR 12 crore for NSO and INR 3 crore for a VNO, with minimum net worth of INR 25 crore for a unified service operator (NSO) and a gentler INR 10 crore for a VNO — thresholds that a serious startup, a satellite entrant or a regional broadband player can realistically meet. Tenure of up to twenty years gives the visibility that patient capital demands. The wireline access authorisation offers the lowest-cost doorway yet into fixed broadband — the one segment where India’s penetration has persistently trailed its mobile miracle and where the addressable headroom is veritably enormous. A VNO may now ride on different parent networks for services, letting business models be designed around customers rather than around a single host’s footprint. The captive framework gives factories, ports, campuses and data centres a lawful on-ramp to private networks. And the removal of the prohibited-investor test simplifies the funding conversations on which every new entrant survives.

The sectoral arithmetic that follows is encouraging: satellite formally seated as the fourth pillar of digital infrastructure alongside fibre, mobile networks and data centres; fresh investment plausible across gateways, ground stations, terminals, managed services and edge infrastructure; partnerships between telcos and satellite operators have been made likelier ; and M2M and enterprise connectivity given room to multiply endpoints faster than subscribers. Honesty requires one caveat on the doormat: the welcome mat leads into a hallway where spectrum assignment and authorisation approvals still wait as separate doors, and the newcomer’s business plan must budget for those corridors too. Even so, the direction is unmistakable — the regime has moved from asking a newcomer to prove why it should be let in, towards asking only whether it meets the published bar, and that inversion, more than any fee schedule, is what grows a sector.

Earthquake-proofing — Is the house ready for what is coming?
The truest test of this architecture is not the present but the approaching decade: 6G standardisation in which India has declared ambitions through the Bharat 6G vision, direct-to-device satellite services that blur the boundary between access and space, AI-native networks that will make today’s fraud-prevention mandates look elementary, and machine-to-machine deployments that will multiply endpoints faster than subscribers. Here the rules earn genuine praise for being service-defined rather than technology-defined — a unified authorisation does not care whether tomorrow’s bits travel by fibre, spectrum or satellite, and that neutrality is the best earthquake-proofing a legal document can offer. What remains unfinished is convergence — OTT communication services stay outside this framework, broadcasting remains under a separate roof, and spectrum rules travel on their own track — and unfinished convergence is the crack most likely to widen as the ground shifts.

Bottom line — The insight that matters
The June 2026 notifications are the moment the Telecommunications Act, 2023 stopped being a statute and started being a market reality, and the direction of travel is unambiguously right. But if one insight deserves to outlast this analysis, let it be this: licences migrate by notification; regulatory culture migrates only by habit. The old regime’s burden was never merely its paperwork — it was the instinct of permission, the reflex of discretion, the comfort of the case-by-case. The new house has better wiring, wider doors and a digital threshold, yet the “sound character” test, the open-ended exemption powers and the amendability of conditions are all places where the old instinct could quietly move back in. The remedy is straightforward and entirely achievable: publish the criteria, bind the discretion in transparent specifications, commit to statutory consultation for substantive amendments, and let a sunset review after three years tell us honestly what worked. Ultimately, the measure of this reform will not be how easily one enters the house, but how confidently one can plan to live in it for twenty years. Admiral Hopper would recognise the moment: the sector has, at long last, stopped saying “we’ve always done it this way” — the harder discipline is to ensure we do not simply invent new ways of doing the old things. And the telegram offers its own parting lesson: the telegraph outlived its usefulness, and the Telegraph Act outlived the telegraph; let us make certain that the instincts of the licence era do not similarly outlive the licence. It would be idyllic indeed if, having rewired the house without switching off the lights, we now also teach the household new habits — for a house rewired together, and lived in with trust, is a house that rarely trips.

Alka Selot Asthana is a telecom engineer and Global Head – Regulatory, Tata Communications Limited. Views expressed in the article are personal.