COAI’s 10% verification is now 110%

NEW DELHI: The verification of pre-paid mobile subscribers, which is caught in a 100% versus 10% battle between the Tatas and the rest of the cellular industry, has got a new twist. The director-general of the Cellular Operators Association of India (COAI), TV Ramachandran, says the proposal is for 110% verification, rather than 10%.

This is how Ramachandran explains his 110% figure. In a recent proposal sent to the department of telecommunications (DoT), which was backed by all cellular operators except the Tatas, the association said: “It is reiterated that the paramount responsibility of the service providers is to ensure 100% documentation, which will include documentary proof of address.”

In another letter to telecom minister Dayanidhi Maran, Ramachandran said: “Henceforth, no pre-activated cards/handsets will be available in the marketplace. That is, the connection will not be usable for making any outgoing or receiving any incoming calls until it is ensured that 100% documentation has been submitted by the subscriber applicant.”

Every operator would ensure 100% documentation of the existing subscriber base by March 31, 2007. In addition, the note stated that, “each operator will undertake to carry out a complete cross-check of subscriber details and also a physical address verification of a minimum 10% of his new pre-paid subscribers during each month on a stratified basis”. That makes a total of 110% verification of subscriber details, argued Ramachandran.

The industry proposal, which was sent by COAI and not by the other cellular group, the Association of Unified Service Providers of India (AUSPI), is yet to be approved by
the government. While COAI represents GSM cellular players like Bharti, Hutch and Idea Cellular, AUSPI members include CDMA companies such as Reliance Communications and Tata Teleservices.

The Tata group has been insisting on 100% physical verification of subscribers in keeping with national security requirements. But there is no concrete proposal from the Tata group yet about this. Tata group chairman Ratan Tata, however, is understood to have threatened to pull out of the apex industry body-the Advisory Council of Telecom —over the issue.

AUSPI, it is believed, did not back the industry proposal as its members (read: Tatas and Reliance) are divided on the issue. Earlier also, the Tatas and Reliance spoke differently on the issue of spectrum pricing for 3G telecom services.

An industry insider pointed out that while DoT may approve the industry proposal on subscriber verification, the home ministry may insist upon 100% physical verification keeping in mind the security scenario in the country. However, the time limit of five months given by the government may not be sufficient for cellular operators to perform 100% physical verification of subscribers, he pointed out. A timespan of about eight to nine months would be more realistic to complete 100% verification of all pre-paid subscribers, he added.

The number of cellular subscribers is also critical. While Bharti and Reliance, with over 20 million subscribers each, may find it tough to verify pre-paid subscribers in a short time, Tata Teleservices, with around 10 million subscribers (including wireline and wireless fixed), could complete the job faster, an industry representative said.

Both DoT and the telecom industry fear that the growth in subscriber numbers will slow down after the stringent verification norms are introduced by the government. Currently, there are 106 million cellular subscribers in the country, while the total telecom base was 153.37 million as at the end of June 2006. The government target is to have 250 million phone connections by the end of 2007, out which 200 million are expected to be mobiles.
 
The industry proposal to DoT was in response to the recent government show-cause notice to all cellular operators on the verification issue.