MTNL has been been running a 1,000-line system in Delhi since 1996 and had placed an order for an additional 9,000 lines on Indian Telephone Industries (ITI), which in turn purchased the system from Qualcomm.

Sources revealed that the tests conducted by MTNL on the Qualcomm wireless in local loop (WLL) system installed in Delhi revealed major deviations in the performance of the equipment.

In a communication to Qualcomm, an MTNL official said, "It is observed that there are major deviations in the performance of the equipment and as such it is not possible to commission it in the network." MTNL has also ordered the company to rectify all the major deviations and make necessary improvements to the same.

Sourcessaid that MTNL was now stuck with a system that has numerous problems, as Qualcomm closed shop earlier this year in India and sold its entire infrastructure business to global telecom major Ericsson. The testing of the new equipment commenced in February this year. On March 19, MTNL formulated a report stating that deviations were noticed in 66 tests. These include the extremely critical redundancy test for call processing in case of failure of a call control processor (CCP). CCP failure affect the call origination and delivery, leading to system crash and rendering the entire network unoperational.

In addition, the Qualcomm system had faults in the detailed and bulk billing parameter. For instance, during testing the number of units charged was observed to be less in five out of seven cases of ISD test calls. Metering for three way testing was also found to not be as per specification.

A perusal of the comments by the Telecom Engineering Centre (TEC) reveals that the system does not fully support othercritical features like access to public utility services, site alarm, supplementary services such as STD/ISD locking, abbreviated dialling, outgoing call restriction and support for data, Group 3 fax and PCO connectivity at 16 khz metering pulses.

Sources said that the equipment supplied does not meet all the critical aspects and DoT/MTNL had not so far initiated action to encash the bank guarantees of the company. "What is even worse is that Qualcomm, after selling out to Ericsson, is not at all interested in this project".

Sources said that the biggest loser in the process was the public sector MTNL and ITI, as both the companies had virtually been taken for a ride by Qualcomm. It is not only India, but other countries like Burma, Nigeria and Chile among others who are having headaches due to the company. The Qualcomm in reports filed with the US Securities and Exchanges Commission admitted that Chilean Teleofonia Personal had claimed breach of warranty.

The existing 1,000 line network operated byMTNL has been in the news as a cheap alternative to the GSM-based cellular networks of private providers. A phone user is billed at the rate of local calls, but have to pay a registration deposit Rs 25,000.

On its part, MTNL since early 1998 is planning to set up a GSM-based cellular network in Mumbai and Delhi. Though the project is stayed by a court order, MTNL says that GSM-based network is better.