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TRAI put Rs. 3,000 Crore penalty on Telcos

TRAI noted that the existing players denied points of interconnect deliberately in order to stifle competition

Policy Pulse
Publish Date: Oct 22 2016 10:37AM | Updated Date: Oct 22 2016 6:04PM

TRAI put Rs. 3,000 Crore penalty on Telcos

In ongoing dispute between top telecom companies, the regulator, Telecom Regulatory Authority of India (TRAI), has given its verdict and imposed a penalty of Rs. 50 crore per circle for the existing telecom companies.


The combine fine amount, which all the telcos have to pay is over Rs. 3,000 crore. TRAI put fine after noting that the existing companies are denying the points of interconnect (POIs) - the gateway that facilitates calls of one network to connect with another seamlessly –due to stifle competition.


In the past two months, Reliance Jio had complained to TRAI as well as to the Prime Minister's Office and the Telecom Ministry that the existing telecom companies were not cooperating with it. 


Reliance Industries had suggested that 52 crore calls on the Jio network failed daily as other networks didn't provide it adequate number of POIs for voice calls.


The biggest bone of contention between existing players like Airtel, Vodafone and Idea is that Jio is offering free voice calls to its customers for a lifetime. The other operators argued that this is a form of predatory pricing.


The TRAI, however, didn't agree with this argument and ruled in Reliance Jio's favor. The existing players have so far not commented but industry experts, who didn't wish to be named, said there is a high probably that existing players will approach the courts against the TRAI ruling.