Regulating the dynamics of telecom

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Rajeev Agrawal
Secretary, Telecom Regulatory Authority of India (trai )

“Competition and the technological developments will lead to continuous cost reduction and increased efficiency of operations in telecom sector,” says Rajeev Agrawal. In conversation with Nayana Singh

TRAI has been playing a central role in regulating the telecom industry in the country. Please tell us about the organisation’s mandate?
“The Telecom Regulatory Authority of India Act, 1997” as amended by “TRAI (Amendment) Act 2000” and in conjunction with order dated 9th January, 2004, provides the Authority with mandate of regulating the Telecom and Broadcasting sector.

The mandate of the Authority is to protect the interests of service providers & consumers and to promote & ensure orderly growth of these sectors. The function of the Authority, as listed under section 11 of TRAI Act are of both recommendatory and regulatory types.

Recommendatory functions are pertaining to licensing, competition, technology, equipment, industry and spectrum. TRAI has also to ensure compliance to the terms and conditions of license. It has been mandated to fix the terms and conditions for interconnectivity between service providers and ensure technical compatibility and effective interconnection.

TRAI has to regulate arrangement among service providers on sharing their revenue derived from services. TRAI has to lay down the standards of quality of service and to ensure quality of service. It has to conduct the periodical survey of services so as to protect interests of the consumers. Amongst other functions, TRAI has also to ensure the effective compliance of Universal Service Obligations. The Authority in addition, is also mandated with the task of notifying rates at which the services shall be provided. The text of TRAI Act is available on TRAI website

The policies related to telecommunications affect the lives of millions all across the length and breadth of the country. What new policies is TRAI coming up with to take mobile telephony to all parts of the country?
TRAI has taken cognizance of the need for taking telecom services to all parts of the country. The focus for this had been on reaching the remotest area with a reasonable amount of bandwidth. A study has been conducted by TRAI to work out necessary investment for meeting needs of telecom services in the North Eastern States and recommendations have been submitted. With connectivity through a reasonable bandwidth, telecom service providers can develop their services riding on it.

Steps are being taken to further strengthen the Regulations on Consumer grievance and the measures to protect consumers. TRAI had sent its recommendations on National Broadband Plan to DoT. It has also sent its recommendations to DoT regarding IMT Advanced Mobile broadband services. In addition, TRAI has provided recommendations on guidelines for Unified License for telecom services.

Spectrum has been delinked from the license. The Government has approved the scheme for creation of National Optical Fibre Network for providing broadband connectivity to 2.5 lakh Gram Panchayats. The project is expected to be completed in two years. Using such bandwidth, the telecom service providers would be able to provide access to fixed as well as mobile broadband services in the far flung and interior areas. Data communication is assuming increasing proportions of Telecom traffic.

The issues like cloud computing, interconnection for IP based networks, fixed mobile convergence and cyber security are some of the key areas which would require attention in near future for facilitating regulations. The networks and services are transiting towards converged platforms where it is difficult to segregate the issues in terms of media, telecom or IT. Further the operations of such converged networks have little regard of geographic boundaries.

TRAI has been encouraging mobile payments in various forms

In the field of telecom, new developments are happening at fast pace. What steps are you taking to ensure that growth and innovation continue to happen in the sector?
Dissemination of information using telecommunication networks has become a basic necessity in today’s world. The policy and regulations are all working towards the objective of bringing growth to the telecom sector in order to help in bridging the digital divide and to promote financial inclusion.

Technological neutrality of the policies and regulations had, in the past successfully promoted the growth. Use of LTE and OFC related technologies are acting as big capacity multipliers for telecom networks. Ubiquitous availability of high speed connectivity across the terrains may still call for timely and effective USO support. The competition and the technological developments will lead to continuous cost reduction and increasing efficiency of operations.

Today mobile technologies are providing a crucial role in promoting Financial Inclusion in the country. Please throw some light on TRAI’s initiatives in this area.
Financial inclusion can be promoted by empowerment of the have-nots and by taking the financial services to their doorsteps using mobile phones. It increases their market reach and productivity. Through the efforts of TRAI like calling party pays, USO initiatives, monitoring of roll out obligations and promoting competition amongst telecom service providers, explosive growth of cellular mobile services has taken place with a reach across the country.

In addition, the National Broadband Plan will enhance availability of affordable and reliable bandwidth for both fixed and mobile devices. Application developments will get a big boost as a consequence of such market expansion. All this will make more and more people use the banking and financial services even at the places where there is no branch of the bank. The cash handling capability of distribution system of pre paid mobile services and its penetration coupled with concepts like business correspondents of banks provide a great potential for banking or other financial services to get extended across the country. Added with common service centres, functioning out of enhanced broadband access, the process of promotion of financial inclusion will be facilitated to a great extent. Recently, TRAI has released a Consultation Paper for USSD based mobile banking services.

What steps are being taken to encourage mobile payments within the country?
TRAI has been encouraging mobile payments in various forms. Necessary regulations have already been brought out regarding quality of service. The major initiative had however been focussed towards the people who do not have access to banks branch. For the others, the mobile payment is just an additional way of doing the banking with the convenience of mobility. For the people in rural areas without branches of banks, it is one of the basic necessities to get access to banking and other financial services through a convenient and affordable access. Common infrastructure model, Business models for interconnecting service providers etc will encourage propelling the mobile payments Gateways. TRAI had been keeping a close watch on the requirements.

The cost of spectrum is very high, leading to the rise in the cost of services. What are the policy initiatives to keep it optimum for the Indian market?
The price, one is willing to pay for spectrum, relates to what advantages he can reap out of getting its right of use. There is nothing like an absolutely high or low price of spectrum. Primarily it relates to perception on status of economy, demand and supply and the extent of liquidity with the prospective buyer. Its economic value depends on several factors.

Firstly, it depends on whether the use of the spectrum is liberal or restricted. Secondly, it depends on developments in user technology. New technological developments are facilitating more efficient use of spectrum. Thirdly, the price depends on strings attached to issues like spectrum sharing, trading, spectrum usage charges, etc and ability to raise loan against spectrum. The status of economic activity and the ability of the end user to pay for various applications also decide the extent to which the extraction of economic value is possible from spectrum.

What initiatives are you taking to bring more transparency in the distribution of spectrum?
The allocation of spectrum so far has been done in two ways – through administered price reforms and through auction. Both the processes have their well known pros and cons. In the recent recommendations on reserve price for auction of spectrum, TRAI has made specific efforts to ensure, that the prospective bidders get a clear picture of terms and conditions of the proposed auction For example, the recommendations provide that the notice inviting applicants (NIA) for the prospective bidders should clearly indicate that trading of spectrum will be allowed. The TRAI recommendations clearly indicate necessity of bringing out complete guidelines for spectrum sharing prior to issue of NIA. An attempt has been made to address all the issues raised by various stakeholders regarding transparency and to maximize the economic value of the spectrum to be auctioned.


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