Internet body petitions CCI on telephony

Frustrated with an almost seven-month delay in the Department of Telecommunication (DoT) response to the Telecom Regulatory Authority of India (Trai) recommendation that the Internet Service Providers (ISPs) should be permitted to use telephone lines to make internet telephony calls, the Internet Service Providers Association of India (ISPAI) has moved the Competition Commission of India (CCI).

It has alleged in a petition that the government’s delay in opening up internet telephony is “favouring mobile operators and preventing fair competition”.

The government currently does not permit internet telephony calls to terminate on phone lines. Internet telephony services from the likes of Google, Skype, Yahoo and MSN are considered illegal in the country.

For over a year, the country’s 75-80 ISPs have been demanding that internet telephony be opened up to the masses, which will result in cheaper calls and increased penetration.

“We have been advocating in favour of internet telephony, which is meant for rural India and common citizens. Voice is the accepted medium of communication between illiterate also in their regional language even. Hence, internet telephony can be a cheap solution on broadband, which will become a killer application and will also result in increasing penetration of broadband in rural areas,” said Rajesh Chharia, the President of ISPAI. If the internet helps the people of India to make cheaper phone calls, the internet would emerge as the commons man’s need, he added.

DoT, in response to a Trai letter dated August 18, 2008, had admitted that the “...need to encourage internet telephony for wider penetration of voice service is recognised. However, it is felt that before this can be done, there are number of issues which need to be resolved”.

A major issue, it argued, is that internet telephony has already been permitted to Access Service Providers (UASL/CMTS/Basic Operators) who paid an entry fee of Rs 1,658 crore as against the Rs 10-20 lakh (depending on the service area) that ISPs paid.

DoT had asked Trai how a level playing field would be ensured between the Access Services licensees, who pay 6.8 or 10 per cent of their annual gross revenue (AGR) of licence fee depending upon the category of different telecom service area, and how would ISPs pay a flat rate of 6 per cent of their AGR from internet telephony services (excluding revenue from internet services)?