Private telecom operators including Bharti Airtel, Jio, and Vodafone Idea are on a standoff with state-owned Bharat Sanchar Nigam Limited (BSNL) over who should bear the cost of transitioning interconnection framework away from legacy networks.
Efficiency vs. Legacy
While private telcos have urged the Telecom Regulatory Authority of India (TRAI) to mandate a shift to Licensed Service Areas (LSA) level, IP-based interconnection, BSNL said it has invested heavily in LongDistance Charging Area (LDCA) level infrastructure over the years. The shift now to comply with LSA regulations could strand its assets and impose unrecovered costs, the PSU said. Whereas for private telcos, the sub-LSA interconnection frameworks is inflating costs, distorting competition, and delaying network modernisation, hence the plea for shift.
Telecom access services are regulated at different geographic levels, mainly national-level services like satellite and internet-based connectivity, circle-level mobile services tied to LSA, and localised wireline services linked to individual exchanges- Short-Distance Charging Area (SDCAs). Interconnection serves as the operational backbone of telecom networks, ensuring that users of one operator can seamlessly communicate with another.
The private operators said that maintaining points of interconnection (PoIs) at lower levels such as SDCA or LDCA, primarily used for legacy wireline services has become economically inefficient as traffic increasingly shifts to mobile and IP-based networks. They also flagged that fragmented interconnection arrangements complicate billing, provisioning, and dispute resolution.
“Interconnection is a licensing and regulatory mandate, the infrastructure cost is equally applicable to all TSPs and should apply for their outgoing traffic only,” Vodafone Idea said, adding that the average life of any telecom equipment is 10-12 years or lesser. As the technologies are continuously evolving Private TSPs have already moved to IP based POI’s, it said.
BSNL, however, has cautioned TRAI against a rapid transition. The PSU argued that different access services—national-level internet and satellite services, LSA-based mobile services, and SDCA-based wireline services cannot be treated uniformly.
It added that bringing all these services at same level will affect BSNL adversely, unlike other telcos.
“BSNL maintains that there can be no level playing field amongst different categories of TSPs – especially in terms of Organization Structure, capex and opex invested by different categories of TSPs for providing different types of telecom services,” the state run telco said.
Migration and Financial Protection
For migration to LSA, the company has sought phased migration timelines of up to five years, along with revenue protection or compensation for legacy infrastructure.
The PSU also opposed mandatory IP-based interconnection in the near term, citing security readiness and the need for substantial investments to upgrade firewalls, gateways, alongside monitoring systems.