The Nepal Telecommunications Authority (NTA) has revoked CG Communications’ restricted mobility license after the company failed to renew it within the appropriate timeframe.
In seven districts, the provider had a license to provide restricted mobility services.
The telecommunications sector regulator announced on Tuesday that it had taken action against CG Communications in a public notice (CG Telecom). From Sunday, CG Telecom will be unable to provide its restricted mobility service dependent on wireless telecommunications in the districts of Baglung, Palpa, Kanchanpur, Dadeldhura, Baitadi, Bardiya, and Dailekh.
According to Sandip Adhikari, deputy director of the NTA, the action was taken after the private telecom firm failed to renew its license within the three-month deadline.
“The company has been prohibited from operating its restricted mobility service in defined districts due to its failure to follow the government rule’s norms,” Adhikari added.
Operators must apply for renewal three months before their license expires, according to the statute. However, by paying a 15% fine, the company will renew it in three months.
Surprisingly, the regulator acted only one day after CG Chairman Binod Chaudhary pledged in a television interview to expand CG Telecom’s offerings in order to provide free voice service.
Adhikari, on the other hand, ruled out the possibility of the NTA taking deliberate action against the firm. “The NTA took similar action against companies like Smart Telecom and United Telecom Ltd Nepal for failing to renew their operating licenses on time,” he said, noting that telecommunication service providers must renew their licenses every five years.
CG Communications, according to Adhikari, can provide services in other areas besides those related to limited mobility service in the seven districts listed.
In the domestic telecommunications industry, Nepal Telecom and Ncell have a significant market share, while the remaining four firms, including CG Communications, have a limited market share. The landlocked nation, which has a population of around 30 million people, has nearly 100% mobile penetration and nearly half of the population has access to data services.
In 2013, CG Telecom purchased an 80 percent interest in rural telecom service provider STM Telecom, which is owned by STM Communications Service Inc of the United States. Following the move, the company has been working with the NTA to acquire a single license in order to broaden its services.
Last July, CG Telecom announced a $100 million deal with Huawei Technologies of China to introduce 4G phone services to the region. It has set a plan to upgrade the service to 5G in the future as part of the agreement. Apart from data, online payment, and other services, the company was supposed to provide free voice services. The company had also claimed that by implementing cutting-edge technologies, it would be able to capture a third of the market share in three to four years.
However, it has not yet been able to obtain a unified license.
While the government had agreed two years ago to grant CG Telecom a unified license, the NTA had refused to grant the company the unified license and frequency spectrum, accusing the company of violating government rules.
Telecommunication service providers should pay all unpaid fees, including those related to restricted service licenses, to the NTA. According to the NTA, CG Telecom was also refused a unified license because it failed to extend limited mobility services in Nepal’s eastern zone.