Telcos approach Trai to hold call drop compensation

Ask regulator not to enforce rules till March 10 hearing in Supreme Court

Telecom operators on Monday approached telecom regulator Telecom Regulator Authority of India (Trai), asking it not to enforce the regulation on compensation for call drops till the hearing in Supreme Court, slated on Thursday.

“The Supreme Court has directed the matters to be listed on March 10, for final disposal. In view of the above, and since the aforesaid matters being sub judice before the Hon'ble Court, we request you to keep your letter, dated March 2, in abeyance,” Cellular Operators Association of India (COAI) and Association of Unified Telecom Service Providers of India (AUSPI) wrote to Trai.

Trai had asked all telecom service providers for a compliance report on the readiness in their networks for offering compensation to the mobile users for call drops by Monday. Last week, the Supreme Court refused to grant interim relief to the operators while listing the case for hearing. The operators had challenged Trai’s regulation in the high court here, which in turn dismissed the telcos petition, following which the operators went to the Supreme Court last week.

In October last year, Trai had come out with the regulation which was to come into effect from January 1, mandating operators to give one rupee for every call drop to the user, with a maximum of three per day.

The telcos had termed the regulation as arbitrary and whimsical, contending that providing compensation to consumers amounted to interfering with the companies' tariff structure, which could only be done by an order, and not by any regulation.

Trai had told the high court that consumers have a right to get compensated for call drops and this was different from the quality of service guidelines that cellular service providers have to follow under the licence conditions. However, telcos had argued that even if consumers were facing problems, a regulation without statutory backing cannot be created.

According to analysts, if Trai’s regulation is implemented, it could lead to a decline of seven-eight per cent in the operating income of telecom operators. However, for companies that had a call drop rate of two per cent or below – as was mandated earlier – will see a negative impact of three-four per cent on their operating income. Interestingly, the new regulation does not allow leeway of two per cent call drops, which means the regulator expects the network to be perfect and telcos to pay for every call drop.

Communications and Information Technology Minister Ravi Shankar Prasad had recently said, “During the past six months, nearly 20,000 sites have been added for 2G (second generation) services across India. Similarly, nearly 45,000 sites have been added for 3G services.”

The government has been asking operators to invest in infrastructure to improve the quality of services, while operators say spectrum crunch is a major problem for call drops scenario.

Trai has been conducting service quality audits of networks on a regular basis since July and had published results of the most recent survey on February 4. It conducted drive tests during December-January on selected routes of seven cities – Delhi, Mumbai, Pune, Surat, Bhubaneswar and Indore – and shared the findings with the telecom operators. According to the report, most telecom operators, including MTNL, failed the tests.
MOUNTING TROUBLE

• On October 15, Trai had mandated telcos to pay subscribers Rs 1 for every call drop, subject to a cap of three call drops a day per user
  

 

Operators challenged the ruling in Delhi HC in December, 2015 which was dismissed on March 3
 

Operators then went to SC for a stay , but got no interim relief, hearing fixed for March 10
 

Telcos said the outgo from the industry would be nearly Rs 54,000 crore annually, but TRAI debunked these claims and said the outgo would be only nearly Rs 800 crore annually