Regulations
4 Reasons why compensation for call drops is fair
TRAI should periodically publish results of their audit giving full details of number of subscribers compensated by each telecom operator, and total number of call drops for each operator. 
 
The Telecom Regulatory Authority of India (TRAI) has announced that from 1 January 2016, all telecom operators should compensate mobile users in the event of dropped calls. The regulator has concluded that call drops are instances of deficiency in service delivery on the part of telecom operators, which cause inconvenience to the consumers. TRAI has ordered that  telecom companies will have to pay their subscribers Re1 for every call drop they experience on their network, subject to a cap of three call drops a day per user, starting from 1st January next year. 
 
What exactly is the rational for TRAI order?
 
TRAI has explained the rational for issuing this order in an exemplary manner worth repeating here for the benefit of readers: 
 
“After a careful analysis, the Authority has come to the conclusion that call drops are instances of deficiency in service delivery on part of the CMTSPs (Cellular Mobile Telephone Service Providers) which cause inconvenience to the consumers, and hence it would be appropriate to put in place a mechanism for compensating the consumers in the event of dropped calls. 
 
“The Authority is of the opinion that compensatory mechanism should be kept simple for the ease of consumer understanding and its implementation by the CMTSPs. While one may argue that amount of compensation should be commensurate to the loss/ suffering caused due to an event but in case of a dropped call it is difficult to quantify the loss/ suffering/ inconvenience caused to the consumers as it may vary from one consumer to another and also in accordance to their situations. 
 
“Accordingly, the Authority has decided to mandate originating CMTSPs to credit one rupee for a dropped call to the calling consumers as notional compensation. Similarly, the Authority has decided that such credit in the account of the calling consumer shall be limited to three dropped calls in a day (00:00:00 hours to 23:59:59 hours).The Authority is of the view that such a mandate would compensate the consumers for the inconvenience caused due to interruption in service by way of call drops, to a certain extent. 
 
“The Authority is also aware that communication to the consumers is important and therefore, the Authority has decided to mandate that, each originating CMTSP, within four hours of the occurrence of call drop within its network, inform the calling consumer, through SMS/USSD message the details of amount credited in his/her account for the dropped call, if applicable.” 
 
This decision of TRAI is sensible for four reasons:
 
  • 1. Deficiency in service delivery: It is for the first time that any regulator has decided to penalise a service provider for deficiency in service delivery and this augurs well for furthering this concept for the benefit of consumers in all areas of public service.  
  •  
  • 2. Ease of consumer understanding: The instant compensation without having to claim by the consumer is the most adorable concept keeping the whole process simple and easy to understand and implement.
  •  
  • 3. Notional compensation: Any inconvenience caused by the call drop cannot be quantified in terms of money. However, TRAI has now proposed only a notional compensation which only offsets the cost incurred by the consumer due to call drops to some extent and this is a good beginning. 
  •  
  • 4. Communication to the consumer: Communicating to the consumers that the prescribed compensation has been credited to their account within four hours of the call drop is the icing on the cake, giving life to the adage, ‘Customer is King.’ 
 
What are the implications of TRAI order?
 
As on 31 March 2015, the total number of wireless subscribers in India was 96.99 crores ( 969.89 million)  as against the total population of our country estimated at 126.74 crores (1,267.40 million or 1.27 billion)  as on that date. This is almost 76.5% of the country’s population enjoying wireless telecom facility, and it is very apt that the TRAI has considered it expedient to improve service standards of telecom companies affecting such a large number of subscribers.
 
The TRAI order has, therefore, several implications. Firstly, it casts an onerous responsibility on the regulator itself to ensure that the order is implemented by the telecom operations both in letter and in spirit. How this mammoth job will be monitored by TRAI is yet unclear, and whether the required technology is in place to implement this order is yet to be confirmed by operators, who have just been given less than three months to be ready with the infrastructure required to implement this decision.
 
Secondly, it is necessary for TRAI to ensure that this will not result in mobile operators raising tariffs to offset the cost of compensation payable to subscribers, as any step towards increasing the tariff would nullify the effect of this order to the detriment of consumers. 
 
Thirdly, TRAI should periodically publish results of their audit giving full details of number of subscribers compensated by each telecom operator, and total number of call drops for each operator. These details will also help TRAI to consider the need to improve the order either in favour of the consumers or the operators, as it is necessary to review the progress made by the operators to improve efficiency of operations, which is the ultimate objective of this decision. 
 
As far as the telecom operators are concerned, it is but natural that they may be unhappy about this order, as there are several reasons for the call drops, many of which may be beyond their control. It is, therefore, necessary for TRAI to understand problems faced by telecom operators to effectively implement this decision. TRAI should also ensure that the bottlenecks encountered by service providers are addressed, if they are within the ambit of government control and provide the support required to facilitate a smooth change over to the new system in the interest of smoothening frayed nerves of the telecom companies. 
 
 (The author is a financial analyst, writing for Moneylife under the pen-name ‘Gurpur’.)

User

COMMENTS

saikat sen

1 year ago

However,in reality, the limit for penalty is at Rs.3/- per day, at the most, but the mobile companies will increase the call charges many fold under the pretext of loss due to such penalty..

ambrish

1 year ago

TRAI is more COAI friendly that consumer as it is more into saving the interests of service providers than of consumers. Some examples:

1. Companies were charging no amount towards stationary or other admin charges, TRAI allowed it and now companies are taking Rs. 2 towards it.

2. Companies were offerring tariff for 365 days or life time, TRAI limited it for 90 days.

3. Earlier validity of each tariff was 30 days, how and when it converted into 27 or 28 days with the consent of TRAI is mystery, it resulted 10% increase in expenses of consumer.

4 How telescopic tariff was allowed, when companies are charging hefty amount towards STV then why this arbitrary provision to charge first two/three minutes @2 or 3 paisa per second.

5. Many companies have charged hefty amount from consumers for lifetime validity and tariff, what about refund of it.

6. Why it was made mandatory that consumer should use XX Rs in time span of 180 days to keep the no. active.

7. This penalty for call drop, how and why it was decided that only Rs.3 penalty (Max) can be received. Does it mean that complaint of call drop will not arise in more than three cases

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