Trai doubles penalty for service quality violation

The Telecom Regulatory Authority of India (Trai) has doubled the penalty for violation of the parameters based on which service quality is determined in an effort to make telecom companies (telcos) improve their networks and reduce call drops.

“From the monitoring of performance of cellular mobile telephone operators, Trai observed that the present amount of financial disincentives has not acted as a sufficient deterrent against non-compliance as there have been repeated consecutive cases of non-compliance with the benchmarks,” the telecom regulator said in a statement on Thursday.

According to the new rules, a telco will be fined Rs.1 lakh for first non-compliance with the benchmarks in a quarter while non-compliance of the same in consecutive quarters would earn the telcos a fine of up to Rs.2 lakh.

The new penalty norms are an increase from the limits issued by the telcom regulator in January, where the telcos were to be penalised a minimum of Rs.50,000 up to Rs.1 lakh for subsequent violations.

Interestingly, Trai has not mentioned anything about compensation to users, which was the centre of the debate on disincentivization of call drops. Telcos have said that if such a thing were implemented, they would have to approach the courts.

Trai is still working on the user compensation issue and is likely to issue recommendations soon, said a senior government official. The move comes at a time when the government and the telcos have been at loggerheads over the significant drop in quality of service over the past few months, in the country. The telcos have been complaining that they are unable to put up the necessary number of towers due to radiation fears, the high-handedness of municipal bodies as well as the lack of spectrum—the key resource needed to offer mobile phone services in the country.

The government, on its part disagrees on the spectrum point, but has issued advisories stating that radiation fears from telecom towers was unfounded. It has also asked government offices to allow telecom towers to be erected on their premises.

On Wednesday, the drop in quality of services surfaced in the meeting of Vodafone Group Plc chief executive Vittorio Colao and finance minister Arun Jaitley on the issue. Trai also carried out drive tests in Delhi and Mumbai, on 27-28 September, to measure the quality of service of the telcos, for the purpose of the regulation.

The tests found that in Mumbai none of the operators were meeting the prescribed benchmark but there was marginal improvement for some of the operators. “In Delhi, some of the operators have improved the benchmark and three operators are still not meeting the benchmark,” Trai said in a statement.

The data shows that there has been some improvement in call drops on network of Aircel, Idea Cellular and Tata Teleservices (GSM) in Mumbai, while the problem has further worsened on network of Vodafone, Bharti Airtel and Reliance Communications (GSM). The regulator found that only Tata Teleservices in Delhi and Bharti Airtel in Mumbai are offering voice quality as per the set standard.

Analysts said that the new norms won’t address the issue properly. “Before the recommendation is implemented, the root cause of the call drop should be analyzed. e.g. lack of sufficient towers in the service area, strict radiation norms which are stringent than the global norms, spectrum issues, etc. must be addressed,” said Hemant Joshi, partner, Deloitte Haskins and Sells LLP.