TRAI wakes up to pass rules on Broadband and Telephony

TRAI seems to have discovered its powers all of a sudden. In the past 2 weeks, it has passed orders with far reaching consequences. The first and foremost is the broadband speeds. It said that anything less than 256 kbps is not broadband. We all knew about that one Sir! For almost a year there has been enough noise being made about the way, companies are cheating its customers. Sify was the earliest on the block and hence deserves a mention here. Sify Broadband totally distorted the concept of what Internet access should mean. In this regard, I feel sorry for the customers who had no other option except to sign up for something marginally better than dial up but all being disappointed with the offerings. The worst part is that there is no mechanism of redressal.

The other players in the “broadband” market were quick to distance itself from the offerings. However, companies like Airtel market their pathetic 128 kbps or less under the brand name as Airtel Broadband. I feel that this may be a major lacuna in enforcing the recent TRAI order. Well, as they say, it is easier to get away with almost anything in India.

Why is it that these people tend to restrict the offering to such pathetic levels? The major reason is that most of the users use it mainly for checking email or web surfing which don't take in account the amount of bandwidth consumed. Tata's have an unlimited account of 128 kbps which is over priced at Rs. 6000. Tata's can easily lower this price offering and set the market on fire. However, high upstart costs mean that they want to suck out the money as fast as possible.

Given in this scenario, it is indeed laudable that TRAI finally acted. I believe that someone higher up might be reading these columns to make an effort to bring about a change. The second significant order that came in was regarding the Push to Talk telephony. This walkie-talkie style of conversation did not find many buyers and the companies offering the same, namely Hutch and Tata's did not have the license for the same. Tata has claimed that they were offering it under their ISP license. How far it is true is not known since the law can be twisted to change its meaning totally. However, TRAI's order assumes significance because it clamps down on the operators. I am sure that Hutch and Tata's would make their lawyers busy now!

Another significant ruling that came in was the barring of the Fixed Wireless phones as “mobile phones”. These phones would now have to be clamped down in a particular place and not be used as they have been used as before. This is because they have landline tariffs and do not attract the same ADC as the mobile phones do. The familiar culprits are BSNL! They have done it again exposing the idiocies in regulation. I sincerely believe that these Fixed Wireless Phones were a Godsend opportunity for small businesses and individuals who did not have to depend on the all-powerful linemen or bribe them to get connections. Everyone knows about them but no action is taken against the erring employees. In this regard, it was easier for Reliance and Tata's to scale up margins and hence profits. This decision by TRAI is much uncalled for indeed.

TRAI recently chastised Tata's for the threat of national security. Now the heat of national security is shifting on to other operators. Tata's have been accused of the same issue that Reliance had to face recently, namely changing the international caller id to local calls in order to avoid paying the ADC component. I had earlier mentioned about the foolhardiness of Tata's to share the essential equipment with other players in the market. Network is the jugular for any operator. This way any grey market calls landing in India become extremely difficult to trace and hence a potential for breaching the national security exists. In order to cut down the costs and scale up rapidly Tata's carried on board other operators without realizing the implications of their actions. In this matter, any action taken by TRAI is indeed appreciable. How they follow up on the same is another matter.

Last but not the least. TRAI, in a significant move called for a consultation paper on reducing the ADC charges further. Again, the usual suspects BSNL and MTNL cried foul about the supposed losses. It is another matter though that BSNL is supposed to fund the rural expansion accruing from its own resources. However, they applied for Universal Obligation Fund and were able to bag the contracts. More on that in a later post. Howsoever I may detest BSNL for its lousy services; it is the dark horse of Indian Telecom. It can do in broadband what it did in mobile phone services.

In a recent survey on the quality of services, most of the operators fell short of the prescribed norms. It is not surprising given the obsession to scale up customers by all means possible. A part of the advertising budget can clearly be earmarked for improving on the services or perhaps cut down on the fringe benefits of their marketing heads. I have no idea as to how everyone arrives at a consensus on NOT improving the customer satisfaction but think of gimmicks. Surely, there must be a whole department to come with “out of the box ideas”!

Let us wait and watch as to how things unfurl in the Indian Telecom market.

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL - BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.