The Hindu : Basic, cell cos. clash on entry fee

Online edition of India's National Newspaper
Thursday, Sep 18, 2003

Business

Business

Basic, cell cos. clash on entry fee

By Our Special Correspondent

NEW DELHI SEPT. 17 . Officials of basic and cellular phone companies today clashed at a Telecom Regulatory Authority of India (TRAI) organised `Open House' meeting on levying additional entry fee for WLL mobile (WLL-M) services.

Both sides took divergent stands in the name of the consumer who, they apprehended, would be impacted. Basic phone companies opposed the imposition of additional fee on them, which, they feared, would raise the cost of operations and ultimately affect the common user. Cellular companies demanded compensation for the years their revenues have suffered due to WLL (M) services and justified a telecom dispute tribunal's directive to fix entry fee on WLL (M) companies. The compensation would be ultimately passed on to the consumer in the form of modernisation and lower tariff costs.

The open house session is part of the consultation process before the TRAI issued guidelines on a policy matter. In this case, the telecom dispute tribunal had ruled on the legality of WLL (M) services and directed the TRAI to initiate action on four aspects to create a level playing ground between cellular and basic phone companies. The most important of them is about fixing an appropriate one-time entry fee for WLL (M) companies

Basic phone companies maintained that limited mobility service was only a value addition to their existing landline services and any additional fee was, therefore, unjustified. They pointed out that it was just like the short messaging service (SMS) offered by cellular companies, which did not pay any additional entry fee for offering this service. In case the TRAI decided to stipulate entry fee on limited mobility companies, the six companies that got the basic phone service licence in the first phase of liberalisation should be exempted, said Mahendra Nahata of Himachal Futuristic Communications Limited (HFCL). The company is one of the original licensees along with Hughes Ispat, Reliance, Bharti and Tata Telecom. It also single-handedly derailed the liberalisation process in the basic phones segment in the early 1990s by quoting Rs. 80.000 crores in licence fee for nine telecom circles and then withdrawing from its commitment.

The cellular operators felt opposition to entry fee for WLL (M) service was unjustified. They also demanded compensation for the two and a half years during which these companies ran limited mobility services without paying additional entry fee and eroding revenues of cellular companies. The cellular sector drew attention to the recent telecom dispute tribunal judgment, which acknowledged that unimpeded operations by limited mobility companies had disturbed the level playing field between cellular and basic phone companies.

Printer friendly page
Send this article to Friends by E-Mail

Business