Exemption to Trai order on discriminatory pricing violates license conditions: GSM telcos

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Indian GSM telecom operators have alleged that the Trai via the exemption to the discriminatory tariffs order has allowed a backdoor entry of differential pricing through closed electronic communication networks (CECN), which is also known as intranet.


The telcos, through their lobby body COAI, said that a clause that exempts products offered over CECNs, violates license conditions. They have also demanded an urgent review of the regulator's order barring discriminatory pricing of data services.

"'The licensee shall not offer VPN/closed user group services to its subscribers.The CECN is nothing but a closed user group of the electronic kind and hence impermissible as per the licence," COAI said, in a letter to Trai, citing the clause under the Unified Licence (UL) terms.

COAI's director general Rajan Mathews said that the concept of CECN i.e. "treating a mobile operator's network as a closed network is inconsistent as the mobile network operator's network (PLMN) by definition is a public network. He added that CECN is not a closed user group.

Trai, the Indian telecom regulator, had disallowed discriminatory pricing of data services in February. The order effectively prohibited zero-rated products such as Facebook's Free Basics and Airtel Zero with a maximum Rs 50 lakh penalty for violators. The regulator however had said that the order won't govern data products offered over CECN or Intranet.

Since then Indian mobile operators have been at loggerheads with the regulator, and have sought more details on the ruling for clarification.

In the letter, COAI said that differential pricing has played an important role in the evolution of mobile telephony in the country. "Special tariff vouchers, on-net calling, STD, roaming, toll-free etc are all examples of differential voice pricing that has worked well in the voice domain," COAI said, adding that disallowing differential tariffs is an unnecessary and unfair measure taken by Trai, thus an appropriate and reasonable approach outlining certain FRAND principles (Free Reasonable and Non-Discriminatory) , could have been considered.

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