Did Airtel, Voda triy to block Jio entry?

Trai has said the three operators were “intentionally denying and delaying” the provision of points of interconnects (PoIs) to Jio, “only to restrict a new entrant thus violating the terms and conditions of licence and regulations of the Authority which also caused a lot of inconvenience to the consumers.”

Months after recommending a penalty of Rs 3,050 crore on incumbent operators Airtel, Vodafone and Idea for not providing enough interconnect points to Reliance Jio resulting in call failures, Telecom Regulatory Authority of India has argued in a letter to the department of telecommunications that its stand was justified. DoT had in February asked Trai to clarify on what basis it had recommended the penalty.

Almost three months later, Trai has said the three operators were “intentionally denying and delaying” the provision of points of interconnects (PoIs) to Jio, “only to restrict a new entrant thus violating the terms and conditions of licence and regulations of the Authority which also caused a lot of inconvenience to the consumers.”

Trai had recommended a penalty of Rs 50 crore per circle for 21 service areas, except Jammu and Kashmir, for Airtel and Vodafone, where the point of interconnect (PoIs) congestion exceeded the permissible limit of 0.5 per cent.

For Idea Cellular, the penalty has been suggested for 19 circles, except Himachal Pradesh, J&K and North East. The penalty for Airtel and Vodafone works out to about Rs 1,050 crore each, while in the case of Idea Cellular it is about Rs 950 crore.    

Reiterating its recommendations on penalty, Trai said the incumbent telcos were willfully delaying the interconnect points as after its intervention Airtel, Vodafone India and Idea provided PoIs at much shorter notices (in some 7 instances within 2-3 days) implying that they were capable of providing such PoIs without any delay.

DoT in its reconsideration had mentioned that the dispute was between operators on a host of points but Trai said if the parties have any other disagreements, these must be resolved and quality of service parameters must not suffer at any point.

Reacting to Trai's latest opinion, Airtel said, “We disagree with the observations and believe that the penalty has been recommended on the basis of an incorrect assessment of the situation on ground. We request the DoT to reject these recommendations and take into consideration the actions taken on ground by Bharti Airtel. The fact is that we have provided PoIs to Jio at an unprecedented pace despite the provision of 90 days in the licence.” 

Trai said that it is mandated by law to ensure effective interconnection and quality of service to the consumers, and any non-compliance of terms and conditions of the licence warrants recommendations for the revocation of the licence.

However, the regulator stopped short of recommending cancellation of incumbents’ licences, saying it may lead to “significant consumer inconvenience”.

DoT in February had asked Trai to clarify on various points and on what basis it recommended the penalty.

Again taking a dig at DoT, Trai said, “It is surprising that DoT, as the licensor, is not aware of date of launch of commercial services by RJIL.” DoT had said it was not clear from the letters of Jio if it had launched services from June 21, 2016.

Trai however said as per its available information, commercial launch of Jio services took place on September 5, 2016.

Trai said there is no provision in the license to deny/delay provisioning of PoIs during the test phase. "On the contrary, the testing cannot be completed unless sufficient PoIs are provided," it said on incumbents contesting testing by Jio.

The regulator also rejected the contention of incumbent telcos that the termination charge of 14p per minute is below cost and therefore owing to asymmetry in traffic with Jio would cause huge losses to them.

Trai said if the traffic is symmetric, there is no need to prescribe termination charges. Also the regulator said the present termination charge has been prescribed after a comprehensive consultation process.

"It fully recovers the cost incurred by the terminating service provider. Therefore, there is no question of loss to terminating service providers due to asymmetry in traffic with Reliance Jio," it said.

Trai rejected DoT's contention that it should have waited before issuing show case notices to the incumbents for failing to provide PoIs, saying "when the Quality of Service parameters were so bad and millions of consumers were suffering due to blatant and wilful violation of the licence conditions and Trai's Regulations" it could not have waited.

Image: Reliance Industries chairman Mukesh Ambani. Photograph: PTI Photo.