 "COAI fires another salvo at Trai, slams VoIP proposal")
The Cellular Operators Association of India (COAI), industry lobby group of Global System for Mobile (GSM) players, has come out strongly yet again against the regulator for reportedly saying that it was intending to create a level-playing by allowing telecom operators to offer Voice over Internet Protocol (VoIP). In a strongly worded letter referencing an interview of the telecom regulator R S Sharma, COAI has said the news report indicates telcos cannot offer VoIP and that the Telecom Regulatory Authority of India (Trai) intends to allow it.
Telecom operators have contended that this is incorrect and that internet telephony is permitted to all mobile and internet service providers since 2006. This letter assumes significance as the sector has been battling the regulator and its ad hoc regulations for over a year now and COAI’s latest letter suggests that the regulator does not have grasp of existing regulations. Under the Telegraph Act, any service can be offered under the license granted (under Section 4). If anything, the Over the Top (OTT) Communication Service Providers like Skype and WhatsApp offer these without any license.
Telecom operators have for long been asking to bring these OTT players under the ambit of the law so that the there is a level-playing field between themselves and OTT apps which ride on the network of telcos but offer cheaper rates as they do not have to pay any of the regulatory levies. Instead of bringing these OTT players under the regulatory ambit, which will allow government authorities to intercept calls made on these platforms, the regulator is talking of creating “a level-playing field” by allowing the operators to do what they are already permitted to do.
Sector experts claim that by creating a level-playing field, the regulator possibly is trying to do away with the interconnect charge of 14 paise that is currently levied for every call going from a mobile network to another. So if a call is made from an Airtel network to a Vodafone network, 14 paise is to be paid to Vodafone as a charge for receiving and processing that call on its network.
Currently, no interconnect charges are payable if a call is routed from a landline to a mobile network. Telcos do not get any interconnect charge for calls that originate from OTT service providers and terminate on mobile networks. The Trai has recommended a mobile termination charge of 14 paise for national calls and 53 paise for incoming international calls, which has been challenged by operators.
An expert says there is no clarity on how to treat termination of calls made through internet telephony and that should be discussed separately by the regulator given that it is under litigation. COAI says in its letter that the cheaper voice rates offered by OTT players is merely the outcome of economic and regulatory arbitrage.
Additionally, the incentive for telecom operators to offer data calls is currently limited because data realisations are lowest in the world at 25 paise for one MB of data. And 1 MB can carry four minutes of voice which means the cost of a data call per minute would be 6 paise. In contrast, realisation of voice calls is at 36 paise per minute.
Given that data price realisation is already below cost in India, COAI has said that there should not be any further tilting of level playing field against licensed service providers.
Telecom operators have contended that this is incorrect and that internet telephony is permitted to all mobile and internet service providers since 2006. This letter assumes significance as the sector has been battling the regulator and its ad hoc regulations for over a year now and COAI’s latest letter suggests that the regulator does not have grasp of existing regulations. Under the Telegraph Act, any service can be offered under the license granted (under Section 4). If anything, the Over the Top (OTT) Communication Service Providers like Skype and WhatsApp offer these without any license.
| LEVEL PLAYING FIELD |
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Telecom operators have for long been asking to bring these OTT players under the ambit of the law so that the there is a level-playing field between themselves and OTT apps which ride on the network of telcos but offer cheaper rates as they do not have to pay any of the regulatory levies. Instead of bringing these OTT players under the regulatory ambit, which will allow government authorities to intercept calls made on these platforms, the regulator is talking of creating “a level-playing field” by allowing the operators to do what they are already permitted to do.
Sector experts claim that by creating a level-playing field, the regulator possibly is trying to do away with the interconnect charge of 14 paise that is currently levied for every call going from a mobile network to another. So if a call is made from an Airtel network to a Vodafone network, 14 paise is to be paid to Vodafone as a charge for receiving and processing that call on its network.
Currently, no interconnect charges are payable if a call is routed from a landline to a mobile network. Telcos do not get any interconnect charge for calls that originate from OTT service providers and terminate on mobile networks. The Trai has recommended a mobile termination charge of 14 paise for national calls and 53 paise for incoming international calls, which has been challenged by operators.
An expert says there is no clarity on how to treat termination of calls made through internet telephony and that should be discussed separately by the regulator given that it is under litigation. COAI says in its letter that the cheaper voice rates offered by OTT players is merely the outcome of economic and regulatory arbitrage.
Additionally, the incentive for telecom operators to offer data calls is currently limited because data realisations are lowest in the world at 25 paise for one MB of data. And 1 MB can carry four minutes of voice which means the cost of a data call per minute would be 6 paise. In contrast, realisation of voice calls is at 36 paise per minute.
Given that data price realisation is already below cost in India, COAI has said that there should not be any further tilting of level playing field against licensed service providers.
