Date:23/09/2004 URL: http://www.thehindu.com/2004/09/23/stories/2004092311940400.htm

New Delhi

50 lakhs BSNL, MTNL phones surrendered

By Sandeep Dikshit

NEW DELHI, SEPT. 22. The number of surrendered and disconnected phones of Bharat Sanchar Nigam Limited (BSNL) and Mahangar Telephone Nigam Limited (MTNL) has crossed the 50-lakh mark in the last two financial years. Phone surrenders in 2002-03 totalled 18 lakhs but rocketed to over 32 lakhs in the next financial year.

At the same time, as on March 31 this year, over 17 lakh people were waiting for phone connections from BSNL, some for several years. The waiting list was high in Kerala, Maharashtra, West Bengal, Karnataka, Rajasthan, Bihar, Andhra Pradesh and Tamil Nadu.

According to a BSNL survey, over half of the ex-subscribers now do not own any phone, 18 per cent have switched over to mobile services, an equal number have surrendered additional lines possessed earlier but still have a BSNL connection, and nine per cent have switched over to private phone operators.

While BSNL managed to attract over 60 lakh mobile phone service subscribers and thus remained on the growth path, MTNL's net new connections were at minus 1.48 lakh lines in 2003-04. Data about the migration of its subscribers in Delhi is unavailable while in Mumbai 40 per cent of those who surrendered their phones move over to private operators. In the previous two fiscals, nearly one lakh mobile and WLL subscribers in Delhi surrendered their phones while 2.36 lakh landline subscribers chose to sever their ties with MTNL. In Mumbai, the corresponding figures were 35,000 and 3 lakhs, respectively. The Union Communications Ministry believes that the tariff structure and the high fault rate are responsible for the mass surrenders in the two metros, particularly large corporates.

"We have to improve the quality of service. We have to be commercially alive and as competitive as the private operator. I own up responsibility for it," the Department of Telecom Secretary told the Parliamentary Standing Committee on Communications.

However, BSNL's "survey" forced the committee to tell it to "take things seriously". It was asked to again study the causes for such large-scale disconnections and try to get as many customers back as possible through better service quality and reliability, aggressive marketing, attractive packages and larger facilities. "BSNL should learn from experience and check further erosion of its customer base as well as make all efforts to achieve the current year's targets," said the committee's report.

It was also annoyed with BSNL for failing to meet the demand for mobile and WLL connections in circles like Chennai and Punjab. Its excuses such as late supply of equipment and interrupted electricity supply are "neither acceptable nor fully convincing". Instead of resorting to excuses, the company's top brass was told to tone up the administration, plan in advance and execute efficiently.

On one hand surrenders were taking place in cities while a huge number of applicants are still waiting for phones in Kerala (over 4 lakhs), West Bengal (1.5 lakhs), Maharashtra (1.59 lakhs) and Bihar (1.12 lakhs). The committee felt BSNL was sanguine about the situation as it was the only service provider in rural areas.

While pulling up BSNL for facile explanations, the committee sympathised with it for not being compensated for heavy losses in rural areas and asked the Government to adequately compensation the company. Analysing BSNL's annual outlays, the committee found that deficit on account of investments in the rural sector was Rs. 15,000 crores in the last three fiscal years and the shortfall on partial reimbursement of licence fee during the same period was another Rs. 3,000 crores. As BSNL has rendered an "important national objective" by providing extensive telephony in rural areas where private operators have been reluctant to enter. It therefore asked the Government to reimburse the licence fee and spectrum charges to BSNL at the earliest. At the same time, the panel noted that outstanding arrears to BSNL and Mahanagar Telephone Nigam Limited are poised to touch Rs. 5,000 crores.

The committee also pulled up private operators including Reliance, Bharti, Tatas and Himachal Futuristic Communication Limited (HFCL) for escaping from their rural telephony commitments after paying "a paltry sum" and called on the Government to effectively enforce the licensing agreements signed by these companies.