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News >> Technology >>
VSNL challenges TRAI
By agencies
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Wednesday, 14 September 2005, 19:30 IST
NEW DELHI: IndiaÂ’s largest out bound traffic carrier Videsh Sanchar Nigam Ltd has challenged the Telecom Regulatory Authority of IndiaÂ’s (TRAI) decision to reduce international bandwidth tariffs with the Telecom Dispute Settlement Appellate Tribunal (TDSAT).
The telecom regulator TRAI had announced 65 percent cut in bandwidth tariffs to bring them at par with low rates prevalent elsewhere in Asia. Indian tariffs are among the highest in the world and the telecom regulator has blamed it on VSNL's dominance in this segment.
The TataÂ’s controlled VSNL however said that Indian international bandwidth was highly competitive and VSNL's market share was 60 percent, and the tariff cut was one of the steepest cut.
"TRAI has changed the methodology of cost calculation without giving VSNL an opportunity to react to it. In addition, TRAI has excluded some cost components, leading to VSNL's costs being under-represented," VSNL said.
VSNL accused the TRAI of selectively using data provided by its own consultant, which shows VSNL and the Indian IPLC market in a relatively poor state. "TRAI has not provided any logical explanation for artificially fixing the price ratios for higher bandwidths. Artificial fixing of prices will mean that resellers will have an advantage over facility-based operators like VSNL by obtaining IPLCs at significantly lower prices," VSNL added.
TRAI had justified its decision to regulate the bandwidth tariff on the grounds that the market was not mature enough. Heavy bandwidth users like IT enabled services, business process outsourcing units and Internet service providers have supported the TRAI decision.