Even at Re 1/drop, could mean Rs 150 cr outgo a day
In a development that may gladden consumers but will come as a big hit for mobile operators, the Telecom Regulatory Authority of India on Friday came out with its regulations mandating telcos to monetarily compensate their subscribers for call drops.
The new rule, which will come into force from January 1, 2016, provides that mobile users will get a compensation of Re 1 for every dropped call, for a maximum for three dropped calls in a day. Effectively, this means that a maximum amount of R3 will be credited into the consumers’ account in a day for call drops.
The reaction to the announcement was as vertically split as was the consultative process, with operators pointing to loopholes and difficulties in implementation, while consumer organisations welcomed the move, saying something was better than nothing.
For operators it comes as a double whammy because apart from monetarily compensating the consumers, the regulator on Thursday had doubled the penalty they need to pay to it for failing to meet various quality of service benchmarks.
With one of the lowest tariffs in the world — 50-60 paise a minute — and the bulk (96%) of subscribers in the prepaid segment generating an average revenue per user (Arpu) of Rs 105 a month, operators were candid in criticising the move, even stating that the option of challenging it in the telecom tribunal or Supreme Court was not ruled out.
“We are very disappointed, we do not believe this is the right solution… There is lot of ambiguity arising from the proposed solutions,” Cellular Operators Association of India (COAI) director general Rajan S Mathews said. It has estimated that the regulation may force the industry to shell out about Rs 150 crore every day even if half the consumers in the country face this problem.
Under the new regulation, the operator will have to send a message to the customer within four hours of a dropped call with details of the amount credited to his or her account. For postpaid customers, the details of the credit would need to be provided in the next bill.
A call drop has been defined as a voice call that “after being successfully established is interrupted prior to its normal completion (and) the cause of early termination is within the network of the service provider”. The compensation would need to be paid to the calling customer who initiates such a voice call.
Criticising the move, operators said the regulation was full of loopholes and could be misused by a large section of subscribers. For instance, though the compensation has to be paid by the originating network, there’s a possibility that the call dropped because of a fault of the terminating network. Further, though call drop has been defined as those that happen due to the system and not the ones that are disconnected by subscribers for better voice clarity, etc, or handset problems, determining the genuine reason for the drop would pose a huge problem. Imagine: With over 900 million subscribers making 10 billion calls a day, and around 10-12 operators in a circle, it would not only pose a huge problem in reconciliation issues but also require operators to invest heavily.
The industry also raised the issue of violation of licence conditions which does not require them to provide 100% in-building coverage. It said that if consumers walk into basements, a lift, interior areas of their house while talking, the chances of a call drop will be high, and asking the telco to pay compensation for such call drops was not fair.
According to operators, the main reason for call drops are the sealing of a large number of towers, provision of inadequate space for putting up new towers, lack of spectrum and reconfiguration of spectrum bands as a result of recent auctions.
However, Trai chairman RS Sharma dismissed any such fears, stating that technology and networks provide a solution and the operators have been given two and half months’ time to put their back-end in shape to meet the new challenge.
On his part, telecom minister Ravi Shankar Prasad welcomed the move but hoped that operators would resolve the issue of call drops and that the penal provisions would not be have to be invoked. “We welcome it and hope that it will go a long way in addressing the concerns of the consumers. I appeal again to all operators to address the issue seriously. I hope the issue of call drops will become a thing of the past at the earliest so that the penalty provision of the regulations will not be required to be invoked,” Prasad said.