Indian regulator says ‘call drops’ all due to telcos’ meager infrastructure investment

March 23, 2016 / by / 0 Comment
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For the Telecom Regulatory Authority of India (TRAI), telcos are the ones responsible for the current massive call drop problem in the country and fixing it should start with penalizing them.

“The issue of call drop is affecting the public at large and different sections of consumer groups have been complaining to the Authority, and it has also been pointed out by the Honorable Prime Minister,” said TRAI in a detailed affidavit filed in the Delhi High Court.

In the last quarter of 2015, TRAI reaffirmed that the regulation that mandated network carriers to pay subscribers Re.1 for every call drop on their network would continue.

“I have made it very clear. It’s a valid regulation…neither overturned by a competent authority, nor annulled, modified or cancelled. The operators must take steps to prepare themselves to implement this,” TRAI Chairman R.S. Sharma told the press. 

However, even as carriers started to comply with the agency’s ruling last January 1, 2016, complaints on the penalty have not stopped. Calling it “harsh” and “unfair,”  carriers emphasize that such regulation would affect their respective cash flows and could lead to a confrontation with the consumers.

The Cellular Operators Association of India (COAI), a lobby group representing giant local mobile carriers such as Vodafone India, Idea Cellular and BSE Bharti AirtelBSE, said it would do all necessary legal moves should the TRAI fail to address its members’ concerns.

“We will discuss matters with them to see if they can address our concerns. If they address them adequately, then there is no particular reason to seek legal recourse. If not, then we will definitely have to evaluate that,” Rajan Mathews, director general of COAI, told the Economic Times.

Matthews pressed that the telcos are taking full responsibility on its inadequacies and promise to do all their best to find a long-term solution. However, the severity of the penalty could just simply hurt the companies’ revenues and lead to more operations-related problems which, in turn, would directly affect customer service.

In 2015, several Tier One telcos in the country agreed to open its doors to 5BARz International (OTCQB: BARZ), a US-based American network enhancement provider firm that promises to improve a mobile gadget’s signal anywhere in the country.

“Our plug-and-play technology, a radio frequency-based network extender product we market simply as 5BARz, is perfect for developing nations like India. Each 5BARz Network Extender will only cost mobile operators $200 per unit, and such pricing would allow telcos to give it to their consumers for free,” said former Apple CEO and company co-director Gil Amelio.

On the other hand, the regulatory watchdog said that the telcos are merely putting up excuses, as they still failed to make infrastructure and system improvements despite making a huge profit in the past few years. Furthermore, TRAI also revealed that call drop problems still happen in areas where mobile tower-related problems do not even exist.

“It appears that the lack of investment in network infrastructure by the petitioners is one of the main reasons for the problem of call drops. The consumer should not be deprived of quality of service by the failure of the service provider to upgrade their network,” TRAI told Times of India.

Although investments in the wireless infrastructure segment have improved, it is considered slow and relatively conservative than expected. Indeed, investments increased only by a paltry 4.6 percent from Rs 2,02,399 crore. “During this period, the minutes of usage (MOU) grew by 6.8 percent and the data usage grew by more than 100 percent. Clearly, the investment has not kept pace with the usage. It appears that the lack of investment in network infrastructure by the petitioners is one of the main reasons for the problem of call drops,” TRAI explained.



Arturo Garcia is a Peruvian-Filipino freelance journalist. He is a self-confessed football fan like most Latin Americans, although he never learned to enjoy basketball, his Filipina mother’s favorite sport. He started out as a political writer for a local daily in Peru, but now focuses on everything-tech and business. Arturo studied Economics at Unibersidad de Lima and currently lives at an apartment in Salinas Valley, Northern California, exactly 725 meters from John Steinbeck’s hometown.