Daybreak - Why communications ministry may be forced to revise the draft telecom Bill

Episode Date: December 9, 2022

The draft telecom Bill introduced by Communication Minister Ashwini Vaishnaw in September this year had a lot of hopes pinned on it. The telecom sector in India is governed by archaic laws. One of them even goes as far back as 1885. But the draft bill left the industry divided.Why? And what are the changes that the government might be forced to introduce to the new bill?Tune in to find out.For more on this, read this report by Pratap Vikram Singh: 900 comments on draft telecom Bill may force communications ministry to make three key U-turnsAlso, listen to this brand new episode of First Principles with NoBroker's Amit Agarwal

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production.

Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get alert, as soon as we release our first studio recording, episode, please follow intermission on Spotify and Apple Podcast or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. We're at the end of the year 2022. And what's the one thing that has been with us through thick and thin? Our phones. Especially since the pandemic, our relationship with our phones has evolved into almost a sort of a codependency.

And Indians happen to be among the largest smartphone users in the world. But here is what is odd. One of the three laws that govern the telecom sector in India to this present day goes back to 1885. And it's not like they're exactly the same as they were more than 100 years ago. Of course, many amendments have been made to include telephones and digital data communication. But the law still falls short in some very important areas like user rights and how complaints are addressed. So when the Communication Minister of India, Ashwini Weishnav,

introduced a new draft telecom bill to the public in September this year, many hopes were pinned on it. And though the response that came was overwhelming, it created a chasm within the industry. The draft received 900 comments. It was a record number. But the the criticism of some of the provisions in the bill was widespread. And it came from everywhere, normal people, telcos and even from within the government. Soon, Minister Ashvini Weishnav was seen going to great lengths to make clarifications about the draft bill. And now, it seems that the government might be forced to change many of the contentious provisions in this new bill. In fact, another revised draft of this new telecom bill is expected to be introduced by today.

So what are the main three U-turns that the government might have to make? Welcome to Daybreak by the Ken, a podcast where we pull up the curtains on the most significant stories from India at the intersection of business and technology. I am Snidth, your host, and today is Friday the 10th of December. The main purpose of introducing this new bill was to replace the three archaic laws that regulate communications in India. In spite of the amendments and additional provisions, these laws simply could not provide the kind of regulatory framework that is required to keep up with changing technology. And the other aim of this new draft was to empower users. After all these years, Indians still do not have access to a proper mechanism for grievance redressal.

In the latest edition of our newsletter, Tech and Policy, my colleague Pratap Vikram Singh, who reports for the ken gave a perfect example for this. Imagine you got an inflated post-paid phone bill. You call your service provider but you're not satisfied with their resolution. You take the matter to Try, the Telecom Regulatory Authority of India. And guess what Try says? And I am quoting this from the Try webpage. Try Act of 1997 does not envisage handling of individual consumer complaints by Tri.

Consumers are advised to take up their complaints with their respective service providers. Complaints, if any, received in try are forwarded to the service provider. No follow-up action is taken by try on individual complaints. No follow-up action is taken on individual complaints. Something had to be done about this. A major overhaul was required and the new draft bill that came was a ray of hope for many. But not long after it was introduced into the public domain, criticism began pouring in from all corners.

So Pratab decided to look closely at what was going on. In fact, he has written a fantastically detailed report on this, and you should definitely check it out. I will link the article to the show notes of this episode. The Ministry of Communications received a record 900 comments on the draft. The draft bill seemed to have disappointed all stakeholders except for telecom companies. In fact, even telcos were not entirely happy.

Reliance Geo, which is the market leader and is in fact known to have benefited from many regulatory gaps opposed some portions of the draft bill. And not just that, senior officials from Tri, the government body, even approached the ministry with their concerns about the bill. Other disgruntled stakeholders include non-profits and US-based tech companies who have actually been lobbying hard to make changes in the bill. Before we move ahead with the story, I have an announcement to make. A brand new episode of First Principles, a podcast by the Ken co-founder Rohan Dharma Kumar, is out. We release a new episode every fortnight where Rohan interviews some of India's most accomplished business leaders and founders. The latest one features Amit Agarwal, the CEO of No Broker, a real estate platform. He talks about how he managed to start a business that almost no investor wanted to fund,

how no broker convinced Indians to pay a subscription fee before finding houses on rent, and the cockroach mentality, and a lot more. I shall link the episode to the show notes for you. And now back to our story. One of the most controversial provisions in the bill involves bringing OTT communication services like WhatsApp, Telegram and Skype under the same line. licensing conditions as telecom service firms. It is supposed to bring in more accountability,

but it also gives the government more power over these platforms. The Global Affairs President of Meta, Nick Clegg, told the Economic Times that including the likes of WhatsApp and Skype under the same framework as telecom service providers is like comparing apples to pairs. The other point of contention in the bill was related to try. The bill sought to enhance the communication ministry's powers and almost override try. And anyway, for many years, the Department of Telecom has consistently been ignoring TRI's recommendations. So for a body that doesn't even have its own budget, the proposed bill can reduce it to just another government policy organization.

The third provision that caused a fair bit of controversy was how the bill allowed the ministry to write off due. owed to the government by private or public entities. Even Reliance's geo-opposed this. In fact, this is probably the only clause in the bill that made the telcos unhappy. They think that this could be a way for the government to create a backdoor entry for the Adani group in Indian Telecom. As the criticism around the bill grew louder,

Ashwini Weishnanov took it upon himself to talk to the press in public and give clarifications to the questions that were being raised. Now, it is most likely that in the revised draft of the bill, the ministry will backtrack on some of its provisions. For OTT communication services like WhatsApp and Telegram, the ministry is expected to introduce a bare minimum of regulations,

and this may involve a simple registration with a nominal fee. These OTT services may not be brought under licensing, which would have forced them to pay an 8% licensing fee. Even with Try, the government may finally give the body some financial autonomy. The bill also proposed to empower the Department of Telecom not to seek Tri's recommendations when it comes to the terms and conditions of the license. That may not be the case anymore. And as for the provision that allows writing off-dews for telcos like debt-ridden Vodafone,

it has its pros. Helping these distressed telcos will ensure a healthy competition in a market and it will be in the interest of subscribers. But many fear that it will give the government the room to favour one particular business group. For now, let us hope that the revised draft has included these important changes and also has clearer provisions for user rights and grievance redressal. If not, this to be law could be seen as biased towards telecom companies. Daybreak is produced from the newsroom of the Ken,

India's first subscriber-focused business news platform. Each episode distills years of reportage, narratives and stories from the Ken's experienced journalist and editors. This episode draws from my colleague Pratab's report titled 900 comments on draft telecom bill may force communications ministry to make three key U-turns. You will find the link to the story in the show notes of this episode. What you're listening to is merely a small slice of our subscriber.

only offerings. A full subscription unlocks daily long-form feature stories, newsletters, subscriber-only apps and podcast extras. Head over to the ken.com slash podcast offer to experience us like a subscriber. I am Snigda, your host and today's episode was edited by my colleague Rajiv Sien. Do tell me what you think of the episode at daybreak at the ken.com. It is t-h-e-h-k-en.com.