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    Trai suggests Rs 3,050 crore penalty on Airtel, Idea, Vodafone for violating quality of service rules

    Synopsis

    In a strong letter issued on Friday evening, Trai recommended to the department of telecom to initiate action against each of the top three operators.

    ET Bureau
    NEW DELHI: India's telecom regulator slapped a combined penalty of Rs 3,050 crore on Bharti Airtel, Vodafone India and Idea Cellular for violating licence norms by denying adequate interconnection points to Reliance Jio Infocomm and said their actions appeared to be aimed at stifling competition and were anti-consumer and against public interest.

    In three almost identical scathing letters to the Department of Telecommunications dated October 21, the Telecom Regulatory Authority of India recommended that DoT take action against each of the three carriers, saying that violation of licence norms warranted revocation of their permits.

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    In three almost identical scathing letters to the Department of Telecommunications dated October 21, the Telecom Regulatory Authority of India recommended that DoT take action against each of the three carriers, saying that violation of licence norms warranted revocation of their permits.


    Image article boday


    The DoT now needs to decide on the next course of action. If DoT finds violations in all the circles, as mentioned by Trai, the telcos would have to cough up a combined penalty of Rs 3,050 crore.

    It is evident that Airtel is in "noncompliance of the terms and conditions of licence and denial of interconnection to RJIL (Reliance Jio) appears to be with ulterior motive to stifle competition and is anti-consumer", Trai said in the letter put up on its website. "The act of Airtel is against public interest." Trai recommended a Rs 50-crore penalty for each of the country's 21 circles, barring Jammu & Kashmir, be levied on Bharti Airtel and Vodafone, which adds up to Rs 1,050 crore for each operator. For Idea Cellular, it recommended the penalty in 19 circles, totalling Rs 950 crore.

    The regulator said the telcos had also "effectively masked the actual position of congestion" at points of interconnect (PoIs) with Jio and therefore Trai was “constrained to accept the congestion data" given by Jio.

    "We are continuously augmenting the PoIs provided to Reliance Jio and the pace of augmentation has been the fastest ever done by us," an Airtel spokesperson said. "Further, we are in full compliance of the requirements of grade of service set by Trai." Vodafone and Idea did not immediately respond to email queries seeking comment.

    A senior executive at one operator said he was "appalled" by the recommendations. "We don't know what the DoT will decide, but would we take this lying down? No way," the executive said.

    SHOW-CAUSE NOTICES
    The highest possible penalty from Trai comes after it issued showcause notices to the companies, seeking explanations for call failures exceeding permissible limits and gave them 10 days to explain why action should not be initiated against them for violation of service quality norms.

    The war of words between Reliance Jio and the top incumbents has been on for the past couple of months, with the new entrant calling out the three telcos for not providing adequate PoIs, required for voice calls to go through from one network to another – in this case, from Reliance Jio’s network to those of Bharti, Idea and Vodafone.

    On Thursday, Jio said that up to 75% of calls from its network to some operators had failed due to inadequate PoIs. The rules mandate a maximum failure rate of 0.5% of all calls. Call failure is when a call doesn't go through to the recipient, while a call drop is when a connection is made and then ends abruptly. "Non-compliance of terms and conditions of the licence warrants recommendations for the revocation of the licence," the regulator said in its strongly worded communication.

    "However, the Authority is mindful of the fact that revocation of the licence will entail significant consumer inconvenience and therefore in view of the larger public interest involved, the Authority recommends a penal action of .`50 crore per LSA (licence service area or circle) where PoI congestion exceeded the allowable limit of 0.5%."

    TELCOS ARGUMENT
    In their defence, the telcos had argued that provision of PoIs was needed only once services were commercially launched. They said Trai's show-cause notices were issued prematurely, without waiting for the outcomes of PoI augmentation that was ongoing – allowed for 90 days as per Trai's 2005 order. The notices were also based on a single day's assessment of traffic, while the benchmark for PoI congestion is considered over a period of one month, they said. The telcos also blamed Jio for being unprepared for operationalising capacities.

    However, Trai rejected their arguments on the grounds that it had been continuously monitoring congestion and added that the telcos had failed to comply with the norms.

    "RJlL had informed their requirement well before commercial launch and telecom service providers are required to comply with the existing regulations related to quality of service," Trai said. The regulator added that telcos had created two separate trunk groups for calls coming and going to Jio to circumvent quality of service norms.


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