Financial Daily from THE HINDU group of publications
Saturday, Apr 08, 2006
Financial Daily from THE HINDU group of publications Saturday, Apr 08, 2006 |
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Regulatory Bodies & Rulings Info-Tech - ISPs ISPs take Net telephony fee issue to TDSAT Our Bureau
The issue DoT wants Net telephony operators to pay 6% of their annual revenues as licence fee. ISPAI say Yahoo, Google and Net2Phone offer Net-based services without paying anything to the Govt.
New Delhi , April 7 Internet service providers (ISPs) have filed an appeal with the Telecom Dispute Settlement Appellate Tribunal (TDSAT) challenging the decision of the Department of Telecom (DoT) to impose licence fee on Internet telephony. The Internet Service Providers Association of India (ISPAI), which is leading the appeal, had earlier told DoT that the move would make the business, which was in its nascent stage, unviable. DoT had asked the operators offering Internet telephony to cough up 6 per cent of their annual revenues as licence fee. This was aimed at bringing the licence conditions for Internet telephony at par with domestic long distance licence norms. TDSAT admitted the appeal and has asked DoT to file its response. The ISPs had earlier moved the tribunal against DoT's decision to impose licence fee on Virtual Private Network, which was turned down by the TDSAT. "Imposition of the revenue share on the `Internet telephony' service being provided under the ISP licence is a solitary and unique case under the prevailing licensing of telecommunication services within the country wherein only one particular service is singularly and specifically targeted for the ad valorem licence fee amongst all the possible and permissible services under a particular licence, viz. the ISP licence," ISPAI said. Until now ISPs had to pay only Re 1 as licence fee.
`Licence fee unfair'
ISPAI pointed out that the imposition of licence fee was absurd because companies such Yahoo, Google and Net2Phone were offering Internet based services without paying anything to the Government. There are around 150 ISPs who have been permitted to offer the Internet telephony service under their respective ISP licences. Though it has been almost four years since the Internet telephony service was permitted, total usage during the financial year 2004-05 was 43 million minutes and the annual revenues add up to Rs 100 crore. "The imposition of revenue share as prescribed in the amendment would surely result in the demise of this customer-friendly service still in its nebulous stage, thereby adversely impacting the competitive choice available to the customers," said ISPAI.
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