1. Therefore, its not legal yet, rather its in a legal grey area.
No. I'm saying with the right licenses, a company can offer services which are almost entirely VOIP based, however, the limitation is that the VOIPPSTN part can not be with the customer, that is, it has to be on equipment under the company's control, that is, at the exchange or cabinet.
2. Are you saying that a company offering an ATA with SIP connectivity to the PSTN network or a virtual PSTN number with VoIP connectivity is the same as a telco using packet based switching on its backbone?
If we oversimplify the situation, then yes - it's the same thing but in a different scope, the main difference is in where the conversion happens: the exchange or the home. As I was trying to convey, the difference is where that PSTN signal changes in to a digital signal (which is where my simplification of the details begins).
In Airtel/Reliance/
Tata's case, maybe the box in your building (or the next building), which in most cases is the same box that supplies DSL service and is most likely to be connected to fiber of some sort. In MTNL's case, it's probably the cabinet in your street or even the exchange itself. Similarly with BSNL.
But in no case is the equipment in the customer's hands. At the moment, the key to this is that the necessary equipment is to be under the control of the company (and indirectly, the government with all it's monitoring awfulness), and as it is now, this way is the only way to satisfy the government requirements for what is more or less a VOIPPSTN interaction - the telco can safely say "this number is assigned to this address".
Unlike VOIP, which is why I think part of the reason for the reluctance to allow VOIP is because it is portable. I can take an ATA or a VOIP number on any SIP software and use it pretty much anywhere on the planet without the provider having much control over that, whereas a PSTN number is assigned to the copper coming in to my premises and to move that number to another location requires their permission and co-operation.
That being said, there's nothing to stop a provider preventing access to it's SIP server from outside it's network, but even if no such measures were taken, it's still easy to monitor - but for some reason the government hasn't yet figured out that it's easier and cheaper to monitor VOIP than PSTN, so, we're stuck with what we have.
