The Telecom Regulatory Authority of India launched a fierce attack on telecom companies in the Supreme Court on Thursday, accusing them of behaving like a cartel that was only interested in profiteering at the expense of consumers who have to put up with atrocious service quality in the form of dropped calls.

Source: PTI

What all did the TRAI say?

''The companies were earning up to 61% profit but only investing 5% in infrastructure and only interested in signing up more subscribers without fixing call drops.''

Appearing for TRAI, before a bench of Justice Kurian Joseph and Justice R F Nariman, Attorney General Mukul Rohatgi told the Supreme Court that telecom companies were to be blamed for investing less on infrastructure and that's the reason for increased call drops.

Source: PTI

Responding to this, the telecom companies have said they are not to blame for call drops and cannot be penalised for it, given the difficulty in setting up telecom towers.

TRAI trashed this argument by saying:

  • Countries like UK, China, Japan, South Korea are deploying alternatives to telecom towers and Indian companies need to follow suit.
  • It also said Indians were already exposed to greater radiation levels legally than in other countries and the difficulty of setting up telecom towers could not be used to justify call drops.

TRAI defended and stuck to its hard stance that telecom operators will have to compensate consumers for call drops.

According to TRAI's October 16, 2015 notification, telecom companies are required to credit Re 1 to a user for every call drop with a cap of Rs 3 per day. telecom industry body,

Cellular operators association of India, had challenged TRAI's notification on December 11, 2015 in the Delhi High Court saying they would have to shell out Rs 54,000 crore a year if they have to compensate subscribers across India.

Source: Reuters

TRAI again lambasted this argument by presenting another fact:

It said that the companies are making around Rs one lakh crore a year from calls and the impact of penalty will be Rs 270-280 crore and not thousands of crore as stated by telcos.

"There was growth of 61 per cent in the subscriber base for telecom companies from 2009 to 2015 and telcos were diverting part of the spectrum to data for making more money''

The Attorney General said the telcos often cite shortage of spectrum as a reason for call drops but the radiowave remained unsold during the recent auction in 700 Mhz band.

He added,

Whether you (telcos) get the spectrum or less spectrum, that is not the problem of TRAI. If you have less spectrum, then you have to either restrict your subscription or you will have to invest on technology. No one has come forward to say my hands are full and I can’t have more subscribers.

(With PTI Inputs)