Telecom is perhaps the only sector where a company can succeed only through co-opetition. The quality of service offered by an operator is highly dependent on how well it interconnects with rival service providers. For example,
an Airtel consumer making a call from her home in Delhi to an RJio subscriber in Chennai will get the best quality of service only if it fulfils two conditions. First, both operators must have good network coverage wherever the caller and the receiver are located. Second, their networks must be interconnected. Even if Airtel invests billions of dollars in rolling out a state-of-the-art network, it will not be able to offer the best service if it refuses to interconnect with RJio. The stand taken by the incumbent operators to refuse interconnection to RJio is an act of self-destruction. The intervention by the Telecom Regulatory Authority of India (TRAI) is, therefore, timely. It must now ensure that incumbent in•cum•bent/,in'kəmbənt/ audio| Adjective: | lying or leaning on something else. |
| Noun: | the official who holds an office. |
operators offer adequate interconnection to Reliance Jio.
At the centre of the incumbent operators’ stand is the issue of the compensation they get for carrying incoming calls from Reliance Jio’s network. Under existing regulations, an operator on whose network the call originates has to pay 14 paise per minute to the operator on whose network the call ends. According to the Cellular Operators’ Association of India (COAI), the industry body representing Airtel, Vodafone and Idea Cellular, this fee is not enough to manage costs when calls coming in from Reliance Jio’s network are disproportionately high due to RJio’s offer of free voice calls. Compared to the average incoming-to-outgoing traffic ratio of 1:1 in the country, it is 10:1 for RJio. In other words, for every one call going from an Airtel’s customer to an RJio user, there are ten calls flowing in the opposite direction. Based on this, incumbent operators had decided to stop interconnecting with RJio till it agreed to pay higher termination charges. But the COAI’s logic appears flawed, given that RJio’s service will be available specifically to those who already own a smartphone that has the capability to make voice calls over a 4G network. There are only about 70 million consumers across the country who have 4G phones compatible with RJio’s network. This will not test incumbent operators who have built robust networks that can support conversations between a billion users. The real issue here is, clearly, the threat of competition.
To be fair, incumbent operators have the right to push their case for higher interconnection charges. They are already doing so by pursuing the issue in various courts. But this tactic of using interconnection as a tool to thwartthwart/'θwɔ:rt/ audio
| Verb: | to hinder or prevent (the efforts, plans, or desires) of. |
| Noun: | a crosspiece spreading the gunnels of a boat; used as a seat in a rowboat. |
new operators should be stopped. TRAI should make it clear in no uncertain terms that providing interconnection is mandatory because at the end of the day the consumer should not suffer.
