Sector regulator Trai on Monday released a pre-consultation paper on unbundling of different elements of telecom like infrastructure, network, services, and application layers through differential licensing.

The move came after the Telecom Department sought the regulator's recommendation on the issue.

The concept of unbundling of layers through differential licensing is enshrined in the new telecom policy, the 'National Digital Communications Policy (NDCP), 2018', Trai noted.

"National Digital Communications Policy (NDCP), 2018, under its 'Propel India' mission, envisages one of the strategies as 'reforming the licensing and regulatory regime to catalyse investments and innovations and promote ease of doing business'," the Telecom Regulatory Authority of India (Trai) said in a statement.

Enabling unbundling of different layers (that is, infrastructure, network, services and application layer) through differential licensing is one of the action plans for fulfilling the strategy, Trai pointed out.

"Through the said letter dated May 8, 2019, Department of Telecom (DoT) has...requested TRAI to furnish recommendations on enabling unbundling of different layers through differential licensing...," it said.

As per the current licensing regime, infrastructure, network and service layers are not segregated and are part of Unified Licence.

Market watchers said that segregation or carving out specific elements, say of network through differential licensing, would enable telcos to reduce their costs by enabling them to outsource certain parts to independent licence holders.

Specifically, Trai has asked the stakeholders about the possible benefits and anticipated problems in having an unbundled licensing regime, and the measures that can be taken to overcome the hurdles.

"In case it is decided to unbundle the different layers of licensing...what should be the different layers and their scope? What changes would be required in licensing regime to enable such a framework?," Trai has asked.

It has also sought suggestions on whether there should be a new regime of licensing on which the existing licensees can migrate within a specified time frame or a parallel incentivised licensing regime for unbundled layers of licence.

For those not in favour of unbundling of different layers of the licence, Trai has asked what changes should be made in the existing licensing regime to promote sharing to increase utilisation of the existing resources, and catalyse investments and innovation in the sector.

It has also asked stakeholders for their views on various other reforms or changes that are required in the existing licensing regime.

The regulator has asked for written comments on the pre-consultation paper by January 6, 2020.