- The Washington Times - Friday, January 24, 2003

CALCUTTA, India, Jan. 24 (UPI) — Ordinarily, for the Indian telecom sector, January should have been a month for celebration.

Its mobile telephony sector grew by over 50 percent yet again in 2002 and hit the 10 million phone mark in the new year.

All this helped India to play catchup, for a nation that is eight years behind the world in average teledensity, with currently just 6 telephones for every 1,000 citizens — the world average is 15 per 100 people and America has 50.ty

But the grim-faced chieftains of the newer mobile phone service providers in India stayed huddled together for most of the month in a desperate attempt to save their businesses.

The mobile service providers are at war with Telecom Regulatory Authority of India, the industry's regulator, accusing it of bias and alleging that it is openly siding with the older basic players who have been allowed to offer limited-mobile services (as wireless in local loop, also called "WLL-M" ) but under fixed-line licenses.

For two years now, limited mobility or WLL-M has triggered a great deal of business acrimony in the telecom industry. The mobile operators have been complaining about the lack of a level playing field.

Their contention: When a call is made from a mobile phone to a WLL-M phone, the mobile subscriber pays rupees 1.20 ($1=rupees 48) for three minutes in addition to the airtime. Of this, rupees 1.14 is paid by the cellular operator to the basic or WLL-M operator.

In other words, the basic operator does not charge anything to its subscribers for incoming calls, but gets Rs 1.14 per call received from the mobile operator. But when a call is made from a WLL-M phone to a cell phone, the cellular operator gets nothing. The fixed-line subscriber is charged Rs 1.20 for a 3-minute call and the money is kept by the fixed-line operator.

Why this anomaly?

Regulators says basic operators have been given this privilege because they also have a mandate of meeting a social obligation that cellular operators do not have. In its bid to wire up the huge country, the government dished out WLL-M licenses on the condition that basic operators will have to reach and run WLL-M telephone services in designated rural areas of the country, most of which are hopelessly uneconomical for running telephony services.

But mobile operators are unwilling to buy the logic because WLL-M is a rival service. They also argue that WLL-M operators are in a position to charge, and have announced, far lower tariffs than the prevailing mobile-phone charges. If mobile operators do not match these rates, their subscribers would switch to WLL-M. Also, mobile operators are unable to meet WLL-M tariffs because they are not given Rs 1.14 per call received on their network.

Although this has been going on for a while, the flashpoint came in December, when, in their bid for survival, the mobile operators took an unprecedented step; they defied regulatory directives and blocked all WLL-M calls coming from the network of the privately owned Tata Teleservices. Though that interconnect was restored soon, other mobile operators across the country decided to block calls from all WLL-M networks last week.

This crisis was averted when Communication and Information Technology Minister Pramod Mahajan intervened on Monday and urged cell operators to interconnect with WLL-M operators immediately. In return, however, Mahajan had to assure that the government, through its regulators, would announce soon an interconnect rate that WLL-M operators will pay to mobile operators.

"The interconnection terms would be ready in the next couple of weeks," Mahajan said.

But the war between the mobile operators and WLL-M/basic operators and the newer mobile companies is far from over. Now, the basic operators have started objecting to Mahajan's truce formula. They said Tuesday that the demands of cellular operators are unjustified.

"The access charge was levied because cellular operators were given airtime charges both for incoming as well as outgoing calls and the entire airtime is retained by them," said an official statement of the Association of Basic Telecom Operators. "Whereas the basic telecom operators do not levy any airtime on outgoing calls and charge only Rs 1.20 for a three-minute call."

The statement added that the interconnect charge imposed on mobile operators would hinder achieving the country's teledensity targets.


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