The ₹3,150-crore penalty proposed by the Telecom Regulatory Authority of India on Airtel, Vodafone and Idea Cellular for not giving adequate interconnection to Reliance Jio will hopefully send out a strong signal to all the players that they cannot abuse their market position and indulge in anti-competitive practices. That said, there is a question mark over whether the regulator followed due process while arriving at its decision to impose the penalty. A reading of the communication from TRAI to the department of telecom (DoT) suggests that the regulator has merely relied on claims and counter-claims made by the operators in letters written by them between July and September. Did TRAI carry out an independent audit of the operators’ networks to get conclusive evidence of the violation or did it choose to quickly lob a hot potato into DoT’s court? The answer to this question will determine whether the regulator’s decision will stand judicial scrutiny.
To be fair, the incumbent operators also have to take the blame for inciting the regulator into taking action. A letter from the Cellular Operators’ Association of India, the industry body representing Airtel, Vodafone and Idea Cellular, to TRAI on September 2 stated that the incumbent operators were not obliged to give interconnection to Reliance Jio. At the centre of their stand is the issue of compensation they get for carrying incoming calls from Reliance Jio’s network. Under existing regulations, operators on whose network the call originates have to pay 14 paise per minute to the operator on whose network the call ends. The incumbent operators argue that this fee is not enough to manage costs when calls coming in from Reliance Jio’s network are highly disproportionate due to its offer to give free voice calls. Though incumbent operators have the right to push their case for higher interconnection charges, blocking interconnection is anti-consumer.
However, following a meeting with TRAI on September 9, incumbent operators agreed to release points of interconnection to Reliance Jio. Since then all three operators have claimed to be offering interconnection sufficient to support millions of Reliance Jio users. Reliance’s counter is that the interconnection being released was not enough and therefore its subscribers were not able to make voice calls. This is where TRAI should have relied on its own data collected from network audits done over a period of time. By extrapolating that the overall interconnection between Reliance Jio and incumbent operators has not improved based on network congestion data for a single day, that too supplied by the operators themselves, TRAI has left the door open for courts to intervene. Though legally challenging a TRAI order is not new, the more orders are overturned by judicial bodies, the more TRAI’s credibility gets eroded. DoT must, therefore, ask the regulator to do a thorough audit of the operators’ network to make it a foolproof case.