The Hindu Business Line : TRAI sets higher tariff for managed leased lines

EVEN as the Telecom Regulatory Authority of India (TRAI) announced a higher ceiling tariff for leased lines with Managed Leased Line Network (MLLN) technology, Internet Service Providers and BSNL have expressed their dissatisfaction over the order - though for different reasons.

While Internet Service Providers Association of India (ISPAI) has contested the recognition of MLLN as a value-added service than leased line, Bharat Sanchar Nigam Ltd (BSNL) has called for increasing the tariff ceiling specified for MLLN.

TRAI today, for the first time, made a distinction between leased circuits of the classical kind and leased circuits provided through MLLN technology. Having identified MLLN as leased line connectivity with value-added features, the authority specified higher ceiling tariffs based on different capacity and distance. "In specifying the higher tariff ceiling for MLLN provided leased circuits the authority carefully examined the additional costs associated with providing the value-added features associated with the service," stated TRAI.

The announcement follows TRAI's revised tariff order for domestic leased circuits. For example, the tariff ceiling for 64 kbps (kilo bits per second) domestic leased circuits of the classical kind for distance over 500 km is Rs 44,000, while the corresponding ceiling specified for MLLN in this order is slightly higher at Rs 51,000. Moreover, TRAI has specified distance-based tariff ceilings for capacities of 128 kbps and 256 kbps. For leased lines with capacities higher than 256 kbps and below 2 mbps (mega bits per second), TRAI has not specified any ceiling and has kept the tariff under forbearance. That is, for MLLN services of this category, the leased line service providers can decide their own tariffs.

However, contesting the TRAI order, the Internet Service Providers Association of India (ISPAI) President, Mr Amitabh Singhal, said, "We can't understand the logic behind terming MLLN as a new service since it has been provided for quite a few years. Further, by TRAI's own admission, only BSNL — and not Mahanagar Telephone Nigam Ltd — had represented that MLLN be considered as a new service. How can the regulator decide based on the incumbent's representation?" More importantly, the regulator has not specified any ceiling for higher capacities of 128 kbps and 256 kbps, thus letting the operators charge whatever they want, pointed out ISPAI. "We are considering a representation of the TRAI order," he said. "For so many years, BSNL used to report its MLLN tariffs to TRAI. How come the regulator never identified it as a new service earlier," asked Mr Singhal.

Meanwhile, BSNL senior officials said TRAI's ceiling rates are "too low" and "make it unviable for BSNL to offer the service at specified rates". They added that they would ask the regulator to reconsider its ceiling.

TRAI added that it would revisit the ceiling tariff after a year based on the prevailing market trends and other relevant factors at that time. It is also the view of the authority that costs and capacity utilisation of classical 64 kbps and MLLN based 64 kbps circuits should converge over time, eliminating the need to differentiate.

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