TRAI-COAI spar on interconnect charges consultation paper

MUMBAI: Telco watchdog  the Telecom Regulatory Authority of India (TRAI) has garbaged allegations by the Cellular Operators Associaiton of India (COAI) that its latest consultation paper on call connect charges was “unfair” on incumbent operators and favouring newer entrants. TRAI chairman RS Sharma told PTI that the allegations against the regulator are “baseless.”

TRAI maintained that it will continue to work according to its mandate. "Trai will continue to work in the areas in which it is mandated to work...We will continue to perform functions assigned in the Trai Act, with regard to consumer protection, Quality of Service, encouraging competition, fair play and growth of industry," Sharma said.

COAI had questioned the regulator's urgency in initiating the process of  reviewing interconnect charges – paid by one operator to another for connecting calls, which the association claimed "favours new entrants.” TRAI  said it had undertaken this review in the backdrop of 4G and internet telephony changing the way consumers communicate.

Currently, termination charges for a mobile to mobile local and national long distance call is pegged at 14 paise per minute while the termination charges for international incoming call to wireless and wired line stands at 53 paise per minute.

Trai had sought fresh views on whether this should be continued or whether a new way of computing could be considered which is Bill and Keep (BAK) – to maximize consumer welfare, adoption of more efficient technologies and growth of the telecom sector. Under the BAK method, each telco bills its own subscribers for outgoing traffic that it sends to the  other interconnecting network and keeps the revenue received from its subscribers.

COAI has finger pointed at the regulator’s suggestion, saying it essentially favours new operators as they would  not have to pass any payments to existing older operators, while the latter would end up incurring costs. “This is a misguided effort from the TRAI that will help new entrants at the cost of the incumbent. We are extremely disturbed by this, this further tilts the level playing field,” COAI director general Rajan Matthews had stated yesterday.

This is not the first time that India’s private sector telecom operators have tried to put pressure on the regulator.

Even in the case of net neutrality and zero-rating plans of telecom operators, the telcos had termed certain orders of TRAI without any basis that did not give the telcos a level playing field against new technologies (OTT services like WhatsApp, Skype, etc) and their backers.

Matthews told PTI that his association   had sought a meeting with the telecom minister and secretary “so that the matter can be debated in a transparent manner.”

The Mukesh Ambani-led Reliance Industries Ltd, which has a pan-India licence for providing telecom services by a subsidiary company under Reliance Jio brand name, is slated to launch its services formally later this year. Reliance Jio is also slated to offer its consumers hi-speed 4G broadband services on low-priced Lyf handsets at  monthly subscription rates, telecoms observer opine, that are likely to start a blood-bath in the telecoms sector.

RIL also controls the Network18 media group, founded by Raghav Bahl, which owns several TV channels and online and digital properties.

In recent times, incumbent telecoms operators have been severely criticised within and outside the government for the low quality of services and rampant call-drops that TRAI had tried to rectify by proposing fines to benefit consumers.

This move and other such regulatory initiatives too were criticised by telecos and various telecom industry bodies like COAI and Broadband India Forum.

Interestingly, Reliance Jio  is also a member of COAI, though, according to media reports, its position on the present round of TRAI bashing by telcos is not known and unclear.


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