The issue of compensation over call drops seems to have deepened the divide between the government and the industry, with Telecom Minister Ravi Shankar Prasad reiterating that a penalty for call drops will be implemented as per the regulator's schedule. Separately, Swiss bank UBS has questioned the practicability of implementing the penalty. "We do not think this regulation will be implemented in the near term," it said in an internal note. The bank expects operators to challenge the challenge the order of the Telecom Regulatory Authority of India (Trai) in court.
TRAI on October 16 slapped a Rs 1 penalty on telcos for every call drop from January 1 — for a maximum of three calls a day — payable to the calling consumer. The operators cried foul, saying the new rules could cost them almost Rs 150 crore a day "The telecom operators may have a point. But for the government, what is more important is customer interest...there is therefore no question of going back on the proposal to penalise telecom companies for call drops," Prasad said in Mumbai on Thursday. Prasad met separately with Microsoft's chief executive officer Satya Nadella, who was in Mumbai to celebrate 25 years of the technology giant's operations in India. The telcos had jointly written to Trai, citing their difficulty in implementing the penalty for call drops and questioning whether the regulator had the jurisdiction to order it. The regulator said it would respond to the letter within a fortnight, around mid-November.
While Trai has maintained that it is technically possible to determine the cause of call drops, operators had expressed their inability to do so. UBS endorsed the telecom industry's view, saying "implementation of this idea is likely to be fairly difficult." It explained that the egulator's parameters allow up to 2% call drops in its quality of service requirements and as per the licence agreement, Indian mobile operators need not have 100% geographical coverage.
UBS also said there is room for customers to manipulate call drops to collect the maximum compensation of Rs 3 a day from operators. "For example, a customer may walk into an elevator or inner part of a building knowing that the call is likely to get dropped," the bank said in the note. It added that drained out batteries and problems with the terminating network might also cause call drops, rather than an issue at an operator's end.
TRAI on October 16 slapped a Rs 1 penalty on telcos for every call drop from January 1 — for a maximum of three calls a day — payable to the calling consumer. The operators cried foul, saying the new rules could cost them almost Rs 150 crore a day "The telecom operators may have a point. But for the government, what is more important is customer interest...there is therefore no question of going back on the proposal to penalise telecom companies for call drops," Prasad said in Mumbai on Thursday. Prasad met separately with Microsoft's chief executive officer Satya Nadella, who was in Mumbai to celebrate 25 years of the technology giant's operations in India. The telcos had jointly written to Trai, citing their difficulty in implementing the penalty for call drops and questioning whether the regulator had the jurisdiction to order it. The regulator said it would respond to the letter within a fortnight, around mid-November.
While Trai has maintained that it is technically possible to determine the cause of call drops, operators had expressed their inability to do so. UBS endorsed the telecom industry's view, saying "implementation of this idea is likely to be fairly difficult." It explained that the egulator's parameters allow up to 2% call drops in its quality of service requirements and as per the licence agreement, Indian mobile operators need not have 100% geographical coverage.
UBS also said there is room for customers to manipulate call drops to collect the maximum compensation of Rs 3 a day from operators. "For example, a customer may walk into an elevator or inner part of a building knowing that the call is likely to get dropped," the bank said in the note. It added that drained out batteries and problems with the terminating network might also cause call drops, rather than an issue at an operator's end.