April ended with many busybodies swarming the Telecom Regulatory Authority of India (Trai) office in New Delhi. There were several meetings that demanded “all hands on deck”, called to figure out ways to deal with a major blow to Trai’s role and image. The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) had recently issued a partial stay on Trai’s rules on predatory pricing and defining a significant market player (SMP), i.e. having more than 30% market share, which it set in February. An official present in the meetings said that the stay was akin to “cutting off their limbs” and not letting Trai do its job. It has set the cat among the pigeons since.
Trai is at a crossroads today trying to figure out how to regulate the industry. There are now three major cases being argued in different courts across Delhi, Mumbai and Chennai where Trai is a party, and all of them are taking aim at its core functions in mobile telephony. Namely:
- regulating tariffs where it must ensure that it is non-predatory, non-discriminatory and transparent in nature,
- regulating and ensuring there is interconnection between operators,
- ensuring quality of service for consumers.
These cases are being filed by incumbent operators, Airtel, Vodafone India and Idea Cellular. They say that the new Trai regulations are designed to favour one operator—Reliance Jio. Trai’s counter-argument is that these changes become necessary as India moves towards data-based networks.
But things weren’t always like this.
Trai was established 21 years ago to regulate mobile telephony, which, back then, had only 14.5 million users. Gradually, its scope was expanded to regulate multiple information and communication technologies (ICT). This included internet, television, DTH and radio. Today, all these technologies are converging on smartphones. Hence, Trai’s regulation of the industry in a neutral and impartial manner has become critical.
As a regulator, Trai has not shied away from taking bold decisions to ensure an orderly growth of the ecosystem. For example, in 2007, it passed a regulation which required all DTH operators to offer TV channels on an à la carte basis and said that they could not compel customers to subscribe to a bouquet of channels. Eventually, it fixed bouquet tariffs on DTH for consumers and also made pay channels possible.
But today, that boldness looks partisan. In February, over a Telecom Tariff Order (TTO), Trai changed the definition of an SMP. The order required that SMPs (read as Airtel, Vodafone and Idea Cellular) would have to disclose all their tariffs on an online portal to prevent predatory pricing. But this new definition did not take into account two crucial parameters in place for over 20 years. “As per the earlier definition, [an SMP] had four different aspects to it.