Jio row: DOT to go slow on penalty

At present, dept’s priority is resolution of financial stress in the telecom sector

The Department of Telecommunications (DOT) is not likely to levy a penalty any time soon on the incumbent telecom operators for not providing enough interconnect points to Reliance Jio as proposed by the telecom regulator.

An internal panel of the DOT has to decide on the recommendations sent by Telecom Regulatory Authority of India (Trai) on the issue of penalty. But, at present, the top priority of the DOT is solving the financial stress in the sector. Sources further said that even after the decision of the internal panel, the Telecom Commission will take a final call.

Trai had reiterated its recommendations of levying penalty of ~3,050 crore on Bharti Airtel, Vodafone and Idea Cellular for not providing enough interconnect points to Jio, which resulted in mass call failures. The DoT had in February asked Trai to clarify on what basis it had recommended the penalty.

In its reply, Trai had in May clarified that the three operators were “intentionally denying and delaying” the provision of points of interconnects (PoIs) to Jio, “only to restrict a new entrant, thus violating the terms and conditions of licence and regulations of the Authority, which also caused a lot of inconvenience to the consumers”.

Sources said that the DoT will discuss the matter in detail before arriving at a decision. The operators can always challenge the matter in courts and that is the reason why the DoT wants to do its due diligence before going ahead with levying a penalty, sources added.

Airtel had already expressed its disagreement with the Trai’s decision, saying the regulator had recommended penalty on the basis of an incorrect assessment of the situation on ground. Others, including Vodafone and Idea, too, had presented their point of view on the issue during their meetings with Trai last year.

Seeking clarifications from Trai on the matter, the DoT had mentioned that the dispute was between operators on a host of other points, but Trai said if the parties have any other disagreements, they must be resolved and quality of service parameters must not suffer at any point.

Also, the DoT is not likely to act against Airtel on a complaint by Jio alleging misuse of merger and acquisition (M&A) guidelines by the Sunil Bharti-led firm. Jio had sought that the DoT should not approve the Airtel-Tikona deal unless Airtel pays ~217 crore as migration fee for using broadband wireless access spectrum under the unified licence.

It must be mentioned here that Airtel had already challenged a demand of ~436.09 crore raised by the DoT as an entry fee for migration from ISP licence of Airtel Broadband Services Private Limited (ABSPL) to access services of Airtel in 2013. As the matter is currently in court, the DoT will not raise a fresh demand regarding the Airtel-Tikona deal, which is similar to the earlier pact.