Airtel, Vodafone, Idea Had Ulterior Motive To Stifle Competition : TRAI

Telecom Regulatory Authority of India (TRAI), in a detailed response to Department of Telecommunications (DoT) letter, has rejected to reconsider its recommendation of penalising Bharti Airtel, Vodafone India and Idea Cellular for not providing adequate points of interconnect (PoIs) to Reliance Jio.

Jio said Airtel paid an estimated license fee of Rs 950 crore for Q4 while it paid Rs 1,099.5 crore for Q3. Their report indicates that Airtel, along with Vodafone and Idea have recovered substantially from the onslaught of Jio in the previous months.

In February, the Telecom Commission, the highest decision-making body of the communications ministry, had asked Trai to reconsider its views and sought clarifications on almost a dozen points, including whether the regulator had the power to make such a recommendation and whether the stipulated 90-day period was given to the three telcos for providing PoIs to the newcomer.

The PoI issue has been at the centre of a battle between Mukesh Ambani-owned Reliance Jio on one side and incumbent telcos Bharti Airtel, Vodafone and Idea on the other.

TRAI mentioned that it took cognisance of all the submissions of the three telcos, including the efforts they made, but the steps taken were insufficient to bring down the interconnectivity congestion to the desired level. Also that the three operators "appeared to have ulterior motive to stifle competition".

Hong Kong Based financial services provider UBS AG has released its telecom report for the month of March, and have stated that Jio's aggressive and fast growth mode has slowed down. The regulator, in fact, had stopped short of recommending cancellation of their telecom licences saying it may lead to significant consumer inconvenience.

The whole thing came into limelight after in October past year, recommended penalties of Rs 1,050 crore on Airtel and Vodafone and 950 crores on Idea Cellular, as all the operators violated license norms by denying PoIs to incumbent Reliance Jio. DoT will now consider Trai's views and take a decision.

It also asserted that the provision of financial disincentive in the Authority's "Standards of Service of Basic Telephone Services (Wireline) and Cellular Mobile Telephone Service, Regulations 2009" does not prevent the Authority from exercising its mandate to make recommendations to the Government for wilful non-compliance of terms and conditions of license.

"As per the TRAI Act 1997, DoT is required to send back the recommendations to the Authority for its reconsideration, however in this case, DoT has sent its view on each and every paragraph of the analysis and facts of the case which has never been the practice till date".

The regulator, in its response to the DoT, has mentioned point-by-point reasons for imposing the penalties. Airtel says that the penalty has been recommended on an incorrect assessment of the situation.

Airtel requested the Department of Telecom (DoT) to reject the recommendations and "take into consideration the actions taken on ground by Bharti Airtel".

Jio said it has learnt that Cellular Operators' Association of India in a letter to the DoT had proposed that its member TSPs should be allowed to pay licence fee for Q4 of 2016-17 on the basis of estimated AGR of Q4, rather than the licence condition of paying the estimated AGR of Q4 or the actual amount paid in the preceding Q3, whichever is higher.

  • Zachary Reyes