Centre accuses top telecom firms of deceiving customers

The Centre on Thursday accused top telecom firms of forming a cartel and not creating adequate infrastructure to check call drops despite earning Rs 250 crore a day.

Defending the Delhi High Court’s order of October 16 for firms to pay maximum Rs 3 a day for call drops, Attorney General Mukul Rohatgi contended before a bench of Justices Kurian Joseph and R F Nariman that the penalty imposed by Telecom Regulatory Authority of India (TRAI) on the telecom firms will be around Rs 280 crore and not thousands of crore as claimed by the service providers. 

He claimed that the telecom firms made around Rs 1 lakh crore a year from calls.
“There is a cartel of four-five telecom companies having billion subscribers, who are making Rs 250 crore a day from outgoing calls. They have stupendous growth but they are making minimum investment on their network to improve the quality of service on their network to curb call drops,” Rohatgi said.

Representing TRAI, the top law officer submitted that there was growth of 61 per cent in the subscriber base for telecom companies from 2009 to 2015 and they were diverting part of the spectrum to data for making more money.

“Data service costs more than calls. None of these telecom companies are here for charity. They are here with a billion subscribers for profit. They charge for everything,” Rohatgi said.

COAI, a body of Unified Telecom Service Providers of India and 21 telecom operators including Vodafone, Bharti Airtel and Reliance have challenged the HC order upholding TRAI’s decision making it mandatory for them to compensate subscribers for call drops from this January.

The Attorney General said the telcos often cite shortage of spectrum as a reason for call drops but the radiowave remained unsold during the recent auction in 700 Mhz band.
He said the investment by telcos during the past five years has been Rs five billion, while it was Rs 50 billion in China during the same period. The hearing in the case will resume on April 16.

Booted

The Delhi High Court had upheld TRAI’s decision of making it mandatory for cellular operators to pay consumers one rupee per call drop experienced on their networks, subject to a cap of Rs 3 a day.

Telcos make money through call drops as more number of times a customer call, more operatore are charged irrespective of per second pulse.