View from India: Telecoms sector sharing infrastructure to improve services
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The Telecom Regulatory Authority of India (TRAI) presented a consultation paper on the 'Review of Scope of Infrastructure Providers Category-I (IP-I) Registration'. TRAI has also presented the draft amendment regulations for telecommunication mobile number portability (MNP) per port transaction charge and dipping charge.
The Indian telecommunications sector has undergone a pioneering transition in the last two decades to become, in terms of number of subscribers, the world’s second-largest telecommunications market. India is also one of the fastest-growing telecommunications markets.
The last two years have been a period of consolidation for India's telecoms market. Presently and effectively there are only three private entities and two public sector undertakings (PSUs) that provide access services.
These are vertically integrated service providers. Their telecommunications services include wireline and wireless access, internet, national long distance (nld), international long distance (ild) and enterprise business services. Naturally, TRAI’s consultation paper has reviewed business opportunities for Infrastructure Providers Category-I (IP-I). They provide assets such as dark fibre, right of way, duct space and tower on lease/rent out/sale basis to licensees of telecom services.
What is noteworthy is that IP-I has played a significant role in making affordable telecom services available. The deployment of shared tower infrastructure by IP-I has led to the rapid growth of mobile networks. Over the years, the telecom tower industry has emerged as a trendsetter in the infrastructure segment. The telecom tower companies are registered under IP category-I with the department of telecommunications (DoT). Some of the telecom service providers (TSPs) have also hived off their tower assets into separate entities; these hived-off entities have obtained IP category-I registration.
In order to widen the horizon of the telecoms communications sector in India, this consultation paper recommends further sharing of active and passive infrastructure. By doing so, the investments remain low with a favourable economy of scale. Passive infrastructure sharing allows operators to share the non-electrical, civil engineering elements of telecommunication networks. This might include rights of way or easements, ducts, pylons, masts, trenches, towers, poles, equipment rooms and related power supplies, air conditioning and security systems. Active infrastructure sharing involves sharing the active electronic network elements - the intelligence in the network - embodied in base stations and other equipment for mobile networks and access node switches and management systems for fibre networks.
Infrastructure sharing can broaden the availability of spectrum and data consumption. Even though, in India, presently, the total data consumption is one of the highest in the world, per user data consumption is much less in comparison to many countries in East Asia, Europe and America. As per the Digital Economy and Society Index (DESI) Connectivity Report 2019, published by European Commission, internet traffic per capita in Western Europe is currently 44Gb per month and mobile data currently represents only 6 per centof European internet traffic. In contrast, in India, the share of wireline broadband access in total data consumption is negligible.
TRAI has also presented the draft amendment regulations for telecommunication mobile number portability (MNP) which means users can switch telecom carriers without changing the mobile number. The regulations also extend to per port transaction charge which refers to the charge payable by the Recipient Operator to the Mobile Number Portability Service Provider for processing each porting request of a mobile subscriber number. The focus is also on dipping charge or the charge payable by the service provider who uses the query response system of the MNP service provider for obtaining location routing number (LRN) for correct routing of the number dialed.
As per the draft amendment, the per port transaction charge is proposed to be Rs 5.74. TRAI in its earlier recommendation had suggested a lower fee of Rs 4. The new rate of Rs 5.74 is scheduled to be applicable from 30 September 2019.
The draft states that a subscriber can retain his or her existing mobile telephone number when he or she wishes to switch from one service provider to another or from one technology to another of the same service provider using Mobile Number Portability service within the same Licensed Service Area (LSA) as well as Pan India in any LSA. The Mobile Number Portability is operational in India since 2009, when MNP service licences were issued to two Mobile Number Portability Service Providers (MNPSPs) by DoT.
Most stakeholders feel that there should be a consolidated per port transaction charge subsuming the charges for ancillary services also. It is also felt that number return, subscriber reconnection and non-payment disconnection should be charged separately, whereas port cancellation charge should be included in the per port transaction charge (PPTC). Further, database download should be provided free of charge.
In the case of dipping charges, stakeholders are of the opinion that it should continue to be under forbearance and any service provider that requires the dipping services from the MNPSPs can avail the same on mutually agreed terms with the MNPSPs.
It is hoped that both draft regulations will positively impact the telecom sector, as it has a significant role to play in fulfilling many national programmes. The sector is expected to be a key contributor to various government programmes such as Digital India, Make in India and the development of Smart Cities. These programmes present a host of opportunities for the telecoms sector, especially for the infrastructure providers, as telecommunications infrastructure is the bedrock for achieving the vision of Digital India. Overall, this is hotly anticipated to improve revenues in the telecoms sector.
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