India: ‘Call Drop' For Consumers Is ‘Revenue Drop' For Telecos

In light of the increase in complaints by consumers, Telecom Regulatory Authority of India (TRAI) has notified a compensatory mechanism for consumers facing call drops. TRAI has mandated that call drops are instances of 'deficiency in service' on part of the Telecom Service Providers (TSPs) and has thus ordered compensation by the TSPs to every consumer facing a call drop. The TSPs understandably don't welcome the move and contend that if the compensatory mechanism, which has been discussed in this article, is implemented, they are set to lose out as compensation up to 3-5% of the industry's annual revenue which is approximately USD 36 billion.

According to the TRAI Act, 1997, the function of TRAI inter-alia is to lay down and ensure the standards of quality of service to be provided by the TSPs and conduct periodical survey of such service so as to protect the interests of the consumers of telecommunication service. In exercise of these powers, TRAI had laid down the 'quality of service benchmarks' for TSPs through a regulation in 2009, which was further amended from time to time. According to this regulation, the quality of service benchmark for call drop has been laid down as '<=2%' for the TSPs (QoS benchmarks). In compliance of the regulations, all TSPs are required to furnish monthly reports of their quality of service performances against the set QoS benchmarks to TRAI.

Most TSPs have reported to meet the QoS benchmarks for call drop in their monthly reports. However, with the increase in complaints regarding call drops, TRAI decided to conduct its own tests for the cities of Mumbai and Delhi in June and July, 2015 respectively. The results of the independent drive tests by TRAI stated that, out of 6 TSPs in Delhi and Mumbai, only 1 TSP was meeting the QoS benchmarks for call drop in Delhi and Mumbai respectively. Subsequently, TRAI published a consultation paper dated October, 4th, 2015 on 'Compensation to the Consumers in the event of Dropped Calls' that suggested; (a) provision for not charging for dropped calls and (b) providing credit to consumers for dropped calls. Consequently, on October 16th, 2015, TRAI has by the Ninth Amendment to the 'Telecom Consumers Protection Regulations, 2015 (amendment/said amendment) mandated TSPs to provide compensation to the consumers for call drop with effect from January 1st, 2016.

The said amendment defines call drop as a "voice call which, after being successfully established, is interrupted prior to its normal completion; the cause of early termination is within the network of the service provider" It further states that, every originating TSP providing cellular mobile telephone service shall, credit the account of the calling consumer by one rupee, for each drop within its network, to a maximum of 3 dropped calls in a day. There is also a requirement to provide the calling consumer, within 4 hours of the dropped call through Short Message Service (SMS) / Unstructured Supplementary Service Data (USSD) message in case of prepaid consumers and provide details of the credit in the next bill in case of post-paid consumers. However, according to latest news articles, TSPs have urged TRAI to withdraw its order to compensate users for call drop saying it is a coercive and grossly unjust measure and will force TSPs to raise tariffs. TSPs have also indicated that TRAI may not have the jurisdiction to order compensation for call drops.

SDA COMMENTS:

While the intent of TRAI to make TSP to provide seamless services to its subscribers is commendable and is in line with steps to improve quality of coverage, there seems to be an ambiguity and lack of clarification pertaining to the said amendment which makes this step come across as a half-hearted measure.

There are certain questions that arise, the primary one being the determination of a dropped call. The term 'normal completion' under the definition of call drops has to be elaborated for clarity for determination of a dropped call. It is essential to figure out whether there was a call drop due to a problem in the network or the call was terminated by the consumer. The TSPs are contending that many consumers may deliberately cause calls to drop, so as to gain monetary benefit, which could eventually run into millions for a single TSP.

Further, there seems to be a disparity between the existing QoS benchmarks that provide for a leverage of up to 2% and the said amendment which prescribes a penalty from the very first instance of a dropped call. In the absence of any clarification, it is understood that with the said amendment, TRAI is envisaging a 0% call drop regime. It therefore remains to be seen whether TRAI would come out with clarifications before the amendment is put to test or the TSPs challenge the same before the appropriate authority subsequently increasing tariffs to meet costs.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.