Cellular Operators Dismiss Dot Plea For Tariff Hike

The Cellular Operators Association of India (COAI) has dismissed the grounds on which the department of telecommunications (DoT) had moved the Telecom Regulatory Authority of India (TRAI) for an increase in tariff on fixed-to-cellular calls in non-metro circles. COAI submitted its response to the DoT petition before the regulator yesterday.

In its petition, DoT said fixed-to-cellular was a new service for which there was no tariff before its January 29 order which fixed the tariff at a maximum if Rs 28 for a three-minute call. Till then, the service was being charged at the rate of local calls in good faith to help an industry which was in its formative stages. COAI has, in response, cited the tender norms which say that the tariff will be on the lines of the charges in metro circles. An industry expert attached to the association said DoT should have laid down in the tender guidelines that fixed-to-cellular call tariff will be fixed later.

 

The expert said DoT was not helping the cellular industry. If the department did not commission the services within the stipulated timeframe, it would be liable to pay damages. DoT had also cited the issue of multiple points of interconnectivity between the cellular network and the DoT network. If an operator established a point of interconnect in a circle, it would be able to charge a lower tariff than an operator which did not have this facility.

This, according to the department, would create an anomaly.

COAI says this would not be an anomaly, but competition. This would be in keeping with the views of TRAI which favours market-determined rates, said the expert.

DoT also sought a hike on the ground that if the current rates continued, it would lose out on STD revenue, essential to meet its social obligation.

DoT has not connected even half the villages yet. Moreover, the equipment installed in rural areas does not work. The department is thrusting its social obligation on private basic service providers, said the expert. Private basic operators are required to provide 10 per cent of their connections in rural areas.

DoT has also said that there is no revenue sharing arrangement at present and each operator keeps the revenue accruing from its network. But COAI says cellular operators pay DoT at the rate of Rs 1.40 per for each cellular-to-fixed calls and full STD rates for calls made by a cellular subscriber to a fixed line telephone outside the circle. These charges have to be paid within one month irrespective of whether the operator has collected the bill from its subscribers, said the expert.

DoT will file its rejoinder to the cellular operators response before TRAI after a week. Hearings in the case begin on July 14.