TDSAT verdict: Open to dissection and interpretation (11 August 2003)
Last Friday, telecom service providers across the country were in a tizzy. The Telecom Dispute Settlement and Appellate Tribunal’s (TDSAT) had finally ruled on the cellular operators’ complaint challenging the legality of the wireless-in-local-loop (WLL) service. But the order had a twist in its tail. Although the majority upheld the legality of WLL, the split verdict was open to dissection and interpretation. And the media had a field day recording heated debates, quotable quotes and angry allegations.
While Reliance and other WLL operators claimed victory, the Cellular Operators Association of India (COAI) had plenty to please them too. They pointed to the fact that the TDSAT chairman D.P. Wadhwa, who is the only judicial member, dissented with the majority view. And that the majority judgement also agreed that there is need for a level-playing field between WLL, fixed line and cellular operators and that the TRAI (Telecom Regulatory Authority of India) must put it in place in the next four months
But most of all, they are thrilled with a section of the order that limits mobility of WLL phones to specific local circles. In other words, it bars the WLL service from roaming nationally or even beyond its own limited zone. Since Delhi is divided into four zones and Mumbai into three, this would essentially means that a WLL subscriber in these cities cannot expect his WLL phone to work even within the entire city limit. Or, as Asim Ghosh of Orange told CNBC, “you are tethered to your home base”.
Is such an order feasible? Can any government enforce it, when it involves 32 lakh subscribers, who bought the phones on the understanding that it would work exactly like a cellular phone? Since the average WLL subscriber can include your local plumber, carpenter and neighbourhood college student and many others who will vote in the forthcoming election, can government simply turn around and tell them ‘sorry your phone will only work in a third of greater Mumbai and a quarter of extended Delhi’? Or will government admit that it goofed up badly on its telecom policy and has allowed service providers to sell them expensive phone services without any clarity about the rules?
Unlikely. The 32 lakh people who queued up to participate in Reliance’s Hungama offer or those who think that mobility is synonymous with a pre-paid SIM card cannot be ditched without more litigation. Few mobile phone users know the difference between a WLL phone and a cellular one and they don’t care either. To them the bottom line is clarity of reception, tariffs and the cost of going mobile. But cellular service providers, buoyed by the split judgement, seem set to regroup and file an appeal in the Supreme Court. They would do well to consider a simple fact. All litigation will end some day, but until then Reliance Telecom, which is by far the biggest threat in the marketplace would relentlessly add new subscribers everyday. Every month of delay will make it that much more difficult, if not impossible, for its subscribers to be deprived of the service or any part of it that they had already subscribed for. Clearly, the answer to this confusion is a unified licensing system. As Communications Minister Arun Shourie said after the TDSAT judgement, “All these problems (litigation) are arising because licenses are service specific and technology allows us to do everything.”
TDSAT has now ordered TRAI to create a level playing field between WLL and cellular operators within four months. And would require a solution to four issues: ironing out the difference between license and entry fees paid by different sets of operators, unifying the rollout obligations applicable to them, resolving the dispute over spectrum allocation and finally, integrating the different regulatory regimes applicable to each system. TRAI has already put out a consultation paper on unified licensing, and consumer groups in the telecom sector largely support its proposal. After all, it is ridiculous to confine operators to geographical areas that encourage cartel-formation instead of encouraging them to compete and grow nationally.
However, TRAI’s paper has raised a storm of protest from the cellular lobby. It proposes that basic service providers should have to pay up a higher fee that will be collected through a load on tariffs. The higher amount payable by them would probably have to be the Rs 1,600 crore that was through bids for the fourth cellular licence in each circle. Some experts suggest that that cellular operators may be persuaded to accept a unified license, if basic operators compensate the cellular service providers — particularly, the later entrants — by having them pay a lower revenue share. On the spectrum issue, the TRAI needs to be given charge of spectrum allocation and auction it in a fair and transparent manner. As for the rollout obligations, consumer groups have also said that there is no need to load it on to government-owned fixed line operators and keep all tariffs high to compensate these providers. Instead, rural and remote area telephony must be paid for through the Universal Service Fund.
But the most persuasive reason for shifting toward a unified licence is that TRAI must move away from resolving disputes between service providers and to focus on issues such as service quality, grievance redressal, transparency in billing and anticipating and framing rules for the adaptation of new technology. There are 37 cases still spending before TDSAT alone and more in the courts. At the same time the growing subscriber base of private service providers have led to serious consumer complaints and no redressal mechanism. Cellular service users are constantly complaining about dropped calls, bad reception, choked lines and SMS messages that fail to be delivered on time. And a large number of Reliance’s consumers continue to complain bitterly about its frequent changes in service plans and tariffs. Its probably time for TRAI to end the war of the service providers with a clear focus on the consumers. -- Sucheta Dalal