Satellite operators and several telecom firms support Trai's proposal to classify satellite providers as infrastructure-only players. While this could simplify partnerships, Reliance Jio and the Broadband India Forum have raised concerns regarding the proposed framework.
What Happened
The Telecom Regulatory Authority of India (Trai) is considering a proposal to allow satellite communication providers to operate specifically as infrastructure providers. During an open house discussion held on July 2, 2026, many industry participants, including Bharti Airtel, Vodafone Idea, and Amazon Leo, supported this model. The plan aims to create a clear separation between the network layer—the hardware and infrastructure required to transmit data—and the service layer, which involves providing connectivity directly to consumers. If approved, satellite companies could focus on managing wholesale capacity, while partnering with existing telecom operators to handle retail subscriber services.
The Industry Divide
The proposal has sparked a clear split among stakeholders. Supporters, such as Starlink, Oneweb, and Amazon Leo, argue that this "network-as-a-service" model allows them to play to their strengths by building complex satellite capacity without needing to manage massive retail subscriber networks. They see this as an efficient way to expand coverage in remote areas where traditional fiber-based connectivity is difficult to build.
However, there is significant opposition. The Broadband India Forum (BIF) has argued that limiting satellite operators to an infrastructure role contradicts the Telecommunications Act of 2023, which recognizes satellite communication as a distinct service. By forcing a wholesale infrastructure designation, critics argue that the regulator may be limiting the potential for satellite companies to innovate as independent service providers.
Concerns from Reliance Jio
Reliance Jio has voiced its objection to the dual-layer framework. The company maintains that the existing regulatory structure, which covers satellite gateways and virtual network operators, is already sufficient to handle the needs of the industry. Jio suggests that adding a new layer is unnecessary and could complicate the regulatory landscape rather than simplifying it. This stance is particularly relevant given Jio’s own investments and strategic interest in launching its own satellite capabilities.
Context and Previous Hurdles
The move to separate these layers is a renewed effort by Trai following a setback in January 2025. At that time, the Department of Telecommunications rejected a similar proposal for a unified framework, citing concerns that it might lead to business inefficiencies. For investors, this history highlights that regulatory clarity remains a work in progress in the satellite space.
What Investors Should Track
The final decision by Trai will be the primary monitorable for investors. The key issues include whether the regulator will proceed with this infrastructure-only model despite objections, and how such a structure would impact future license fees or revenue sharing for satellite players versus traditional telecom operators. Furthermore, observers should watch for how this framework interacts with the existing Telecommunications Act, as any legal conflict could lead to further delays in rolling out satellite-based internet services across India.