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TRAI Will Penalize ISPs For Poor Broadband Service


Well, it’s about time: India’s telecom regulator TRAI has updated its Quality of Service (QoS) regulations for broadband, adding a clause which allows it to penalize service providers that fail to meet the QoS benchmarks, submit falsified reports on QoS parameters, or fail to submit reports. The regulations:

For not meeting QoS benchmarks

ISPs will be charged Rs 50,000 per parameter in the first instanc, and Rs 100,000 per parameter for subsequent contraventions. The parameters ISPs need to meet:
i. Activation time: 100% activation in less than or equal to 15 days (subject to technical feasibility).
ii. Fault Repair/Restoration time: fixed by next working day in more than 90% of cases, and 99% in next 3 working days.
iii. Billing Performance: less than 2% billing complaints per 100 bills issued, 100% of billing complaints resolved within 4 days, 100% refund of deposit within 60 days of closure of account.
iv. Customer care responsiveness: 60% of calls answered within 60 seconds, 80% of calls within 90 seconds
v. Connection speed: Subscribed Broadband Connection Speed to be met more than 80% from ISP Node to User.
vi. Service Availability / Uptime: 98%
vii. Packet Loss: less than 1%

Note: our report of these parameters is based on broadband QoS regulations dated 2006. We haven’t been able to locate any updated parameters.

For falsifying reports

ISPs can  be fined Rs 10 lakh per parameter for falsifying reports.

For not submitting QoS reports

If a service provider providing broadband service doesn’t provide QoS reports to the TRAI, it will be charged Rs 5000 per day

Our Take

Financial disincentives are a good move from a customer perspective, but we wonder how the TRAI will ascertain whether reports are accurate or fabricated. The authority must also look into practices of telecom operators like Bharti Airtel: we’ve come across instances of customers complaining about the arbitrary activation of the “Fair Usage Limit”, following which speeds are reduced. The best way of addressing this is to increase competition in broadband, and, in our opinion, the only way of doing that is to open up last mile access to the consumer. Do read our list of 5 things that the Indian government can do to improve broadband penetration.

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TRAI’s Explanatory Memorandum on these regulations

TRAI has laid down the Quality of Service Standards for Broadband Service through the Quality of Service of Broadband Service Regulations, 2006 (11 of 2006) dated the 6th October, 2006. As part of compliance to these regulations the quarterly Performance Monitoring Reports are received from service providers providing broadband service. TRAI also conducts periodic audit and assessment of Quality of Service (QoS) through independent agencies across the country, to monitor the compliance of prescribed standards/ benchmarks. Analysis of these reports of several past quarters reveals that some of the service providers are repeatedly not meeting the Quality of Service benchmarks for some of the prescribed parameters and no consistent improvement is noticed in spite of continuous follow up with the service providers by TRAI. Therefore, a need has been felt to provide for financial disincentives for failure to meet the Quality of Service benchmarks.

2. Keeping in view the need to ensure the Quality of Service provided by the service providers and to protect the interests of the consumers by making these regulations more effective, it is felt that the Quality of Service of Broadband Service Regulations, 2006 (11 of 2006) dated the 6th October, 2006 need to be amended to introduce financial disincentive in relation to the performance of service providers with regard to the Quality of Service benchmarks so as to strengthen the effectiveness and compliance of the said regulations.

3. The draft amendments to the Standards of Quality of Service of Broadband Service Regulations, 2006 (11 of 2006) on financial disincentives were released on 26.10.2012, seeking the comments of the stakeholders. Some of the stakeholders have stated that Telecom Regulatory Authority of India Act, 1997 does not confer upon the Authority power to impose penalty in the form of financial disincentives. In this context, it is stated that the TRAI Act confers power on the Authority not only to regulate but also to ensure the compliance of the provisions of the regulations. The word “ensure” has mandatory connotation, it means “make certain”. Furthermore, the Hon’ble Supreme Court, in its judgment dated the 17, Aug, 2007, in Civil Appeal No. 2104/2006 (Central Power Distribution Co. & Ors Vs. CERC & Anr), inter-alia, held that “it is well settled that a power to regulate includes within it power to enforce”. It will not be out of place to mention that there are a catena of judgments by the Supreme Court wherein the Hon’ble Court has repeatedly re-stated the proposition that legislation should be read and interpreted so as to further the purpose of its enactment and not in a manner that derogates from its main objectives. The Hon’ble Supreme Court in its judgment in the case of State of Karnataka Vs. Vishwabharthi House Building Co-operative Societies and Ors. [(2004) 5 SCC 430], quoted with approval the judgment of Hon’ble Guwahati High Court in the case of Arbind Das Vs. State of Assam & Ors. [AIR 1981 Gau 18 (FB)] wherein it was inter-alia, held that where a statute gives a power, such power implies that legitimate steps may be taken to exercise that power eventhough these steps may not be clearly spelt out in the statute. The Hon’ble Court further held that in determining whether a power claimed by a statutory authority can be held to be incidental or ancillary to the powers specially conferred by the statute, the court must not only see whether the power may be derived by reasonable implication from the provisions of the statute, but also whether such powers are necessary for carrying out the purposes of the provision of the statute which confers power on the Authority in exercise of such powers. The relevant part of the said judgment reads as under:-

“We are of firm opinion that where a statute gives a power, such power implies that all legitimate steps may be taken to exercise that power even though these steps may not be clearly spelt in the statute. Where the rule-making authority gives power to certain authority to do anything of public character, such authority should get the power to take intermediate steps in order to give effect to the exercise of the power in its final step, otherwise the ultimate power would become illusory, ridiculous and inoperative which could not be the intention of the rule-making authority. In determining whether a power claimed by the statutory authority can be held to be incidental or ancillary to the powers expressly conferred by the statute, the court must not only see whether the power may be derived by reasonable implication from the provisions of the statute, but also whether such powers are necessary for carrying out the purpose of the provisions of the statute which confers power on the authority in its exercise of such power.”

In view of the above, the Authority has power to impose financial disincentives on the service providers for non-compliance of the provisions of the Regulations. Keeping in view the comments received from the stakeholders and the need to ensure compliance with the Quality of Service regulations, these regulations have been formulated.

4. Some of the stakeholders have stated that the broadband industry itself is still at a very nascent stage and it needs lesser regulatory framework and hence the QoS KPIs should be revised. Further, exclusions for events beyond the control of service providers should also be taken into consideration for calculation of KPIs, like force majeure & natural calamities, impact due to law & order issues like curfews, bandhs etc., infrastructure issues in security sensitive areas, site access issues due to limited availability of road network, installation time and restoration time delay due to customer unavailability or reasons related with customer premises, failures caused by major power grid failures, unreliable electricity supply, impact due to fibre cuts and other disruptions caused by ongoing- infrastructure improvement projects, repeated theft at sites even after logging complaints with law enforcement agencies like Police, Right of Way (ROW) issues, building access issues, field related permission issues, customer own CPE & wiring issues, laying of aerial network which is prone to external factors and customers who voluntarily accept the lower QoS.
In this context, it is stated that the benchmarks for the QoS parameters as laid down in the Quality of Service of Broadband Service Regulations 2006 (11 of 2006) are sufficiently lenient keeping in view the growth of broadband services and customer interests. Further, it has been provisioned in the regulations that a reasonable opportunity of representing against the contravention of the regulation observed by the Authority shall be given to the service provider before an order for payment of any amount by way of financial disincentive is made.

5. The Authority will monitor the Quality of Service reported by service providers subsequent to the coming into force of these regulations from the point of view of non-compliance with the benchmarks. In case the benchmark for any of the quality of service parameter for Broadband Service e.g. the benchmark for packet loss

6. It has been commented that the Broadband QoS Regulation describing calculation methodology for some of the parameters are not fully clear which may lead to variance in the performance of the parameter reported by service providers vis-à-vis understanding of the regulations by independent auditors while carrying out the audit. However, the measurement methodology of the parameters is already explained in detail in the explanatory memorandum to the principal regulations.
In order to prevent furnishing of false compliance reports to the Authority, financial disincentive not exceeding rupees ten lakh per parameter has been provisioned in the regulations. The Authority is of the view that such provision of financial disincentive will act as a deterrent against false reporting of performance against Quality of Service benchmarks.

7. Some of the stakeholders have stated that the proposal to impose financial disincentives for even minor delay in submission of report for few days is too harsh as delay in reporting is minor/technical violation in nature especially when consumer is not harmed. The case for penalty arises only when any harm has been caused to subscribers due to willful violation by service providers.

It has been observed that in many cases repeated letters and reminders are required to make service providers submit the PMRs. The Authority is of the view that provision of financial disincentive will be a deterrent against such lapses by service providers. Financial disincentive, not exceeding rupees five thousand for every day of delay in submission of the Performance Monitoring reports is liable to be imposed on service provider.


  • http://www.facebook.com/rana.taimoor.180 Rana Taimoor

    While this subject can be very touchy for most people,real estates lawyer
     my opinion is that there has to be a middle or common ground that we all can find. I do appreciate that youve added relevant and intelligent commentary here though. Thank you!

    I am extremely impressed with your writing skills and also with the layout on your blog.real property attorneys Is this a paid theme or did you customize it yourself? Either way keep up the nice quality writing, it’s rare to see a nice blog like this one these days

  • http://twitter.com/chirag Chirag

    This is all hogwash.

    You cannot call an Airtel line without paying 50p per call. Unheard of bullshit. And then the call conveniently is disconnected, the moment the call center guys  senses you are complaining.

    Unexplained/unintimated billing changes. Not to mention the obnoxious attempt to upsell bandwidth.

    Eagerly waiting for Reliance to launch broadband.

  • http://www.facebook.com/tarundua80 Tarun Dua

    Damned if they do and damned if they don’t. I for one remain a firm believer the over-regulation would result only in the unscrupulous players surviving in a tough market.