• OUTLOOK ARENA
  • VIEWS ON NEWS
  • MARCH 16, 2000

The second coming of the Telecom Regulatory Authority

The Parliament has approved the setting up of the Telecom Regulatory Authority of India (Trai) in its new form –regulator and tribunal. The move is aimed at separating the regulatory and appellate functions of the authority.

The Trai’s first stint had mixed success. While the regulator was successful in the implementation of the revenue sharing regime, it failed in its attempts to set interconnect charges between fixed line and cellular networks. This failure jeopardised the implementation of the calling party pays regime in case of cellular telephony. Currently, both the caller and the receiver (in cellular telephony) have to pay up.

The Trai also needs to be credited with the implementation of the plan to slash domestic and international long distance telephony charges and cellular usage and rental charges. The cellular industry is said to have witnessed a surge in subscription post the decline in usage rates. The achievements of Trai have greatly benefited the telecom sector and the users of telecom services.

The main reasons for the dissolution of the Trai were the Department of Telecommunications (DoT) and the Mahanagar telephone Nigam Limited (MTNL). Both these public sector units raised issues pertaining to the powers and rights of Trai to set interconnection charges. Coupled with this, MTNL’s foray into cellular services, on ad hoc terms and using technology that was not compatible with existing technology, also aggravated this issue.

The government on its part seems to have done well by quickly replacing the Trai with a new body. In all likelihood, the new regulator will tackle the issue of the calling party pays regime as top priority. This is one hurdle that continues to stymie the growth of the domestic cellular sector.

Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

Equitymaster Agora Research Private Limited (Research Analyst)
103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407