Addressing mobile phone problems

A study, commis-sioned by the TRAI, reveals an appalling indifference to customer satisfaction.

The mobile phone sector in India is in the news. Customers are finding mobile connectivity a major problem. A study, commissioned by the Telecom Regulatory Authority of India (TRAI), reveals an appalling indifference to customer satisfaction. As regards call drops, operators like Airtel, Idea, Reliance and Vodafone, failed to meet quality norms. Tata (CDMA) in Delhi and Bharti Airtel in Mumbai were the only ones that met the benchmark of less than 2 per cent call drops.

The TRAI has warned the telecom operators that another such study will be conducted soon to see whether they improve their performance. The Telecom Ministry has threatened that even a penalty may be imposed on them.

Initially, the Cellular Operators Association of India (COAI) tried to blame government’s stringent policy regarding mobile phone towers for all this. But the firm stand taken by the government and the TRAI has made the COAI come round and promise to bring about a material change in all this in the next two to three months making the call drop rates in most parts of Delhi, for instance, reduce from 12 per cent now to a level of 2-3 per cent.

All this warrants a peep into the history of the mobile telecom sector in India. On July 31, 1995, the first call on the mobile phone was put through in India between Jyoti Basu, then chief minister of West Bengal in Kolkata and Sukh Ram, then communications minister, in New Delhi. The handset was very expensive (around Rs 35,000 on the average) and the call charges exorbitant (around Rs 25 per minute).

Hence, the mobile phone was looked upon as a status symbol for the high and mighty. But, over time, market forces channelled by effective and minimal regulation resulted in the promotion of healthy competition in the sector. The prices fell steeply benefiting the consumer immensely. The poorest of the poor in urban areas- street sweepers, kabadiwallas, casual workers in the construction sector and street-hawkers chat or listen to music on mobile phones.

By June, 2015, the number of mobile phone subscribers had exploded astronomically to reach around 975.8 million in the country. There are some indications also that more than two-thirds (69 per cent) of India’s rural population has mobile phone connectivity. There has hence been a mobile phone revolution in the entire nation. It is easy to infer that this revolution has helped in pulling up our country from the abyss of the Hindu rate of growth and rampant poverty. The mobile phone sector was, till recently, one of the most loved sectors of the Indian economy.

A number of factors are responsible for this sea change in the attitude towards the mobile telephone sector. While there are around four lakh telecom towers in the country, a lakh more are required to improve telecom services. The telecom operators claim that they have already invested Rs 1,34,000 crore in 2014-15 on the development of networks.

The government sources, however, point out that if expenditure on spectrum is set aside, investment on reinforcement of infrastructure is only 13 per cent of the mobile operator’s revenue. The telecom companies have thus not invested adequately for their infrastructure, though they had agreed to do so.

Premium for spectrum

Further, since telecom companies recently paid a premium for spectrum that could be used for data services, they are trying to focus more on infrastructure on these at the cost of infrastructure to cater to the voice services. Further, because of the highly competitive set up, some companies try to cater to many more subscribers than warranted by technological infrastructure.

It was around seven months back that mobile cellular phone problems assumed serious proportions. The authorities had then started taking stringent measures against mobile telephone towers set up in violation of guidelines that had been painstakingly worked out and laid down in public interest.

Rampant corruption seems to have resulted in these guidelines existing only on paper. The past few scam-ridden decades have succeeded in embedding a wrong concept of enterprise in us. Enterprise the world over means finding new products or processes by using resources more sparingly and efficiently to promote human welfare.

But the notion here is that it just involves finding ways to ov-ercome rules by hook or crook so much so that to talk of a good business person is a contradiction in terms these days. The pity is that in all parts of the world, the most successful businesses are the ones which have been able to maintain over long years their good public images.

Communication is the sine qua non for economic development. Unless the government and the TRAI continue to maintain their proven track record in dealing with the current cellular phone imbroglio, the cherished goal of making India a manufacturing hub of the world will remain a mere pipedream.

(The writer, a former member of TRAI, was Professor of Bu-siness Economics, University of Delhi)

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