ISPs too want revision

Internet service providers have opposed Trai's proposal to impose access deficit charges (ADC) on their services.

The ISPs have said they are beyond the ambit of the inter-connect user charge (IUC) regime as they are not interconnecting parties. ADC and other related tariffs come under the IUC regime.

To their defence, ISPs have quoted an earlier communication issued by Trai: "When the IUC regime was first notified in January 2003, the authority had conveyed to us vide its letter dated October 15, 2003 that ISPs are not interconnecting parties and hence, are beyond the ambit of the IUC regime."

"It is really surprising to note that without even referring to this crucial fact, there is a specific question in the instant consultation paper, purporting ADC recovery as part of IUC regime from the ISPs," Internet Service Providers' Association of India (ISPAI) said in a letter to Trai.

"The very language of this question indicates an inherent bias that proposes a negative incentive on value-added service providers like ISPs for growing the market," the letter added.

According to ISPAI President Amitabh Sibghal, the regulator's proposal amounted to double taxation.

"ISPs do not have stand-alone networks -- they use the infrastructure of telecom operators who pay these levies. Internet tariffs will definitely increase if Trai were to recommend ADC recovery from us," he said. ISPs have also said that Trai's proposal contradicted its earlier recommendations on the issue.

Section 5.2 of the recommendations titled "Recommendation on specific issues referred to by DoT" states that "no levy should be charged from pure value-added services such as ISPs, Email and voice mail service providers which do not own facilities and thus are not in the category of network operators and carriers," they said.

With regard to the regulator studying the situation in other countries, ISPs have highlighted that in every country, "ISPs have been kept outside the purview of both universal service levy as well as the ADC, which are similar in concept and have identical objectives".

"ADC, which is part of the IUC, is to be paid only by facility-based telephony service providers and the value-added service providers are to be kept outside of such a regime," the ISPs added.