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Sunday, May 27, 2018
Reliance Jio complains to DoT against Airtel

Reliance Jio complains to DoT against AirtelThe latest Apple watch offers a service through which a customer can remain connected, make calls, and receive texts and more, even without their iPhone nearby.
Reliance Jio Infocomm (Jio) has asked the telecom ministry to take “severe action” and levy “strictest of penalties” against rival Bharti Airtel for allegedly violating licence conditions by using a network of nodes based abroad to offer its services on the latest Apple watch, which could lead to a security breach. Airtel has denied the accusations, calling Jio’s complaint “frivolous”.

In a letter to the department of telecommunications (DoT) dated May 11, Jio alleged that Airtel has not set up “eSIM provisioning node in India and the node being used to provide Apple Watch Series 3 is currently located outside India in gross violation to the licence terms”.

The Mukesh Ambani-owned telco alleged that this may lead to a national security breach and is a “deliberate and gross violation” of terms and conditions of unified licence.

The maximum penalty for a breach of licence conditions is Rs 50 crore per circle. India has 22 telecom circles. Airtel has denied Jio’s accusations, saying it is “another frivolous complaint by a desperate operator, whose sole aim appears to have a monopoly over everything that they do”.

“All information relating to customers, network nodes, etc. is hosted in a fully secure manner by Airtel India, along with provision for lawful interception,” the country’s top telecom operator told ET in an emailed response. “We will be happy to share more details with the DoT as and when required,” it said.

Officials at Airtel, who did not want to be named said that the only information outside of India is the eSIM inventory, which is like any other SIM inventory data and is a practice followed by almost all global operators. “There is no CDR (call detail record) or KYC (know your customer), or any private information, outside the country and lawful interception is within India,” one of the officials said. He said Apple watch does not change anything per se while changing from the physical SIM to the eSIM, and both are compliant with security and privacy requirements.

Both Airtel and Jio have announced that they are selling the latest Apple watch that comes with built-in cellular, in an attempt to attract or retain high-valued subscribers amid severe revenue and margin pressure due to rock bottom voice and data rates.

The latest Apple watch offers a service through which a customer can remain connected, make calls, and receive texts and more, even without their iPhone nearby. In its letter to DoT, Jio has asked the department to direct Airtel to stop its latest Apple service and start it “only upon complying with the requirements of national security and addressing the violations of the license terms and conditions”.

ET reviewed a copy of the letter.

A subscriber shares the same number in an iPhone and Apple Watch, and uses an eSIM to make or receive calls. The air provisioning of this eSIM is done by a dedicated network of nodes and they contain user information and other sensitive data. The Unified License (UL) states that location of switches and network elements needs to be within the country.

"Airtel has deliberately chosen to install a critical network element outside India for a service being offered under the Access Services License (which) indicates its blatant disregard for the sanctity of the license terms and conditions including important security conditions," Jio has alleged.

It said the new service also necessitates changes in the way security agencies receive and analyse any target information. Airtel should have carried out Lawful Interception Management (LIM) demonstration before launch of this service “so that national security interests are not compromised in any manner”, it claimed.

The telco said it was unaware if Airtel had made necessary changes in its LIM solution or offered the LIM demonstration to DoT or security agencies. The market leader, in its response, said it had notified DoT prior to the launch of the latest Apple Watch, including product features, network architecture and lawful interception, and had requested them to carry out a demonstration of the same.

Jio’s latest complaint is the latest in a series of accusations and counter accusations between the two telcos on several issues including points of interconnect, interconnect charges and advertisements over speed of networks, and Indian Premier League tournament coverage. (Source:ETtelecom)

Telecom companies ask TRAI not to penalise them over minor service issues

Telecom companies ask TRAI not to penalise them over minor service issuesTelecom companies have asked the sector regulator to take a pragmatic view on levying penalties, especially over marginal deviations from quality of service benchmarks as some of those may have been caused by natural events such as floods or heavy rains.

Carriers have argued that deviations may have been due to unforeseen circumstances, system failures or factors beyond the control of the carriers, for which they should not be penalised, and have sought for individual hearings to explain their stand.

“We request that these nominal or marginal deviations from the prescribed benchmarks should be waived off and no financial disincentives should be imposed on the operators,” the Cellular Operators Association of India (COAI) said in a letter to the telecom regulator last week, adding that certain marginal deviations were not material enough to attract financial disincentives when a large number of customers were being served.

ET has seen a copy of the letter.

The association, which represents all private sector carriers including Bharti Airtel, Vodafone India, Idea Cellular and Reliance Jio, said the Telecom Regulatory Authority of India (Trai) should take a ‘pragmatic and considerate view’ on the marginal deviations and sought for a “review of all financial incentive orders” issued from the quarter ended March 2017 onwards.

Rajan Mathews, the association’s director-general, said Trai needed to work with the carriers to address systemic issues, “instead of continuing to slap on penalties which are often quashed or reduced substantially by the courts”.

The view comes even as the regulator is preparing to levy new penalties on carriers based on quality of service benchmarks which came into effect from October 2017. ET reported recently that the regulator was preparing to issue penalties on carriers for not meeting quality-of-service rules in certain circles as per the tougher parameters.

The new rules have toughened the parameters determining call drops, with penalties of a maximum of Rs 10 lakh for every violation. The likely latest penalties, or financial disincentives, will follow show-cause notices that were sent out by the regulator in early March, after going through the call drop data submitted by all carriers including Bharti Airtel, Vodafone India, Idea Cellular and Reliance Jio.

The carriers are learnt to have responded to Trai on the notices, saying that they were enabling their systems to report as per the new rules and added that the data were being reported for the first time, therefore it could have some small margin for errors.

In its May 3 letter, COAI also flagged cases in the past where for minor deviations in the previous quarter, no financial penalties were imposed, but said that of late, the penalties had been compounded to the maximum limit, factoring in consecutive violations. (Source: Economic Times)

Airtel violating licence norms in selling Apple watch: RJio tells DoT

Airtel violating licence norms in selling Apple watch: RJio tells DoTReliance Jio Infocomm (RJio) has accused Bharti Airtel of “gross and blatant violation” of licence conditions while launching Apple Watch Series 3, a move that further intensifies the rivalry between the two telecom companies. In April, RJio had moved the Delhi High Court accusing Airtel of misleading advertisements during on the ongoing Indian Premier League (IPL) series.

In the latest face-off, RJio has shot off a letter to the Department of Telecommunications (DoT) asking it to direct Airtel to “immediately stop this service”. The letter, a copy of which was reviewed by BusinessLine, also termed the services of violating security conditions.

Airtel, in an e-mail response, said it as another “frivolous complaint by a desperate operator” and added that Airtel is a law- abiding and responsible operator. RJio, a wholly-owned subsidiary of Reliance Industries, said Airtel has not set up an eSIM provisioning node — a critical network element which contains important network and user information — in India.

Airtel’s current node, which is located out of India, is a gross violation to the licence terms, it added. “Airtel has deliberately chosen to install a critical network element outside India for a service being offered under the Access Services Licence and this indicates its blatant disregard for the sanctity of the licence terms and conditions, including important security conditions,” the letter said.

Further, Airtel should have carried out Legal Interception and Monitoring (LIM) prior to service launch so that important national security interests are not compromised in any manner. “We are neither aware whether Airtel has made necessary changes in its LIM solution nor if it has offered this service for LIM demonstration to the DT and security agencies,” it added.

Responding to RJio’s allegations, Airtel said, “The DoT was duly notified prior to the launch of Apple watch, including product features, network architecture and lawful interception and we have also requested them to carry out a demonstration of the same” .

“All information relating to customers, network nodes etc is hosted in a fully secure manner by Airtel India along with provision for lawful interception. We will be happy to share more details with the DoT as and when required,” it added. (Source: The Hindu businessline)

HC verdict in Vodafone tax case on Monday

HC verdict in Vodafone tax case on MondayDelhi high court is set to pronounce its verdict on 7 May on the centre-Vodafone Group Plc arbitration row over a retrospective tax liability imposed on the telco for its $11 billion acquisition of Hutchinson Telecom

Delhi high court is set to pronounce its verdict on 7 May on the centre-Vodafone Group Plc arbitration row over a retrospective tax liability imposed on the telco for its $11 billion acquisition of Hutchinson Telecom. The court had reserved its judgement on 8 March after hearing the arguments put forth by the centre, Vodafone Group Plc and an amicus curie

The verdict would be the first of its kind as it is likely to settle issues about the legitimacy of bilateral investment treaties in so far as it seeks to protect a foreign investor from allegedly unfair treatment by the country it is investing in. After the tax liability of over Rs22,000 crore was imposed in 2012, Vodafone had invoked arbitration under the India-Netherlands Bilateral Investment Protection Agreement (BIPA) through a notice of dispute of 17 April 2012 and notice of arbitration of 17 April 2014.

It also invoked arbitration under the India-UK BIPA on 24 January 2017.

The second arbitration was stayed by the Delhi high court in August 2017, after centre moved the court seeking an anti-arbitration injunction on the ground that both arbitrations—under India-Netherlands BIPA as well as India-UK BIPA—dealt with the same issue i.e. whether the amendment to the Income Tax Act which imposed a retrospective multi-crore liability on Vodafone in relation to its $11 billion deal in 2007 acquiring the stake in Hutchinson Telecom was in consonance with the BIPAs.

This stay was revoked by the Supreme Court on 15 December 2017 when it allowed Vodafone to appoint an arbitrator in the second arbitration but added that the proceedings would not start until completion of hearings in the case before the Delhi high court.
During the course of proceedings, the centre had argued that the invocation of simultaneous arbitration under different BIPAs as was a textbook example of ‘treaty-shopping’ by Vodafone, which was antithetical to the intention of signatory parties to such investment protection treaties.

Vodafone, on the other hand, had argued that it was entitled to protection against ‘unfair measures against investors’ under the two bilateral investment treaties and no domestic court could restrain an aggrieved party from seeking such remedy.(Source: Mint)

Cambridge Analytica whistle-blower says Facebook data could be in Russia

Cambridge Analytica whistle-blower says Facebook data could be in RussiaWhistle-blower Christopher Wylie said it was difficult to verify how many people had access to the Facebook information or derivatives of that data “because it was a lot of people”. Some of the information improperly harvested from Facebook Inc. users might be stored in Russia, said the former employee of Cambridge Analytica who blew the whistle on the data-privacy scandal involving the analytics firm’s role in the 2016 presidential election. The data “could be stored in various parts of the world, including Russia,” Christoper Wylie said in an interview with NBC’s ‘Meet the Press’ that will run in full on Sunday.

“The professor who was managing the data harvesting process was going back and forth between the UK and Russia,” Wylie said, an apparent reference to Cambridge University lecturer Aleksandr Kogan. Wylie said it was difficult to verify how many people had access to the Facebook information or derivatives of that data “because it was a lot of people,” according to a partial transcript released by the network.

The number of Facebook profiles whose data was improperly shared with London-based Cambridge Analytica was first estimated at 50 million people. This week, Facebook raised that estimate to 87 million. Wylie said the true figure “could be higher, absolutely.”
“Once data leaves your database, you know, data is a fungible thing, right?” he said. “You can make as many copies as possible.”
Facebook founder and chief executive officer Mark Zuckerberg is preparing to testify before Congressional panels investigating the mishandling of its data and other revelations about the social-media giant.

Zuckerberg is scheduled to appear before a joint hearing of the Senate Judiciary and Commerce Committee on Tuesday to discuss Facebook’s role in society and users’ privacy. He’ll back up Wednesday before the House Energy and Commerce Committee.
Cambridge Analytica was funded by former Renaissance Technologies co-CEO Robert Mercer, a major supporter of President Donald Trump in 2016. Trump campaign official Steve Bannon, who went on to be White House chief strategist after Trump’s election, earlier served on the firm’s board. (Source: Hindustan Times)

Facebook questioned for collecting phone numbers and text messages from Android devices

Facebook questioned for collecting phone numbers and text messages from Android devices On the same day Facebook bought ads in U.S. and British newspapers to apologize for the Cambridge Analytica scandal, the social media site faced new questions about collecting phone numbers and text messages from Android devices. The website Ars Technica reported that users who checked data gathered by Facebook on them found that it had years of contact names, telephone numbers, call lengths and text messages.

Facebook said Sunday the information is uploaded to secure servers and comes only from Android users who opt-in to allow it. Spokeswomen say the data is not sold or shared with users' friends or outside apps. They say the data is used ``to improve people's experience across Facebook'' by helping to connect with others.

The company also says in a website posting that it does not collect the content of text messages or calls. A spokeswoman told the Associated Press that Facebook uses the information to rank contacts in Messenger so they are easier to find, and to suggest people to call.

Users get the option to allow data collection when they sign up for Messenger or Facebook Lite, the Facebook posting said. ``If you chose to turn this feature on, we will begin to continuously log this information,'' the posting said.

The data collection can be turned off in a user's settings, and all previously collected call and text history shared on the app will be deleted, Facebook said. The feature was first introduced on Facebook Messenger in 2015 and added later on Facebook Lite.

Messages were left Sunday seeking comment about security from Google officials, who make the Android operating system.

Reports of the data collection came as Facebook CEO Mark Zuckerberg took out ads in multiple U.S. and British Sunday newspapers to apologize for the Cambridge Analytica scandal.

The ads say the social media platform doesn't deserve to hold personal information if it can't protect it.

Facebook's privacy practices have come under fire after Cambridge Analytica, a Trump-affiliated political consulting firm, got data inappropriately. The social media platform's stock value has dropped over $70 billion since the revelations were first published.

Among the newspapers with the ads were The New York Times and The Washington Post in the U.S., and The Sunday Times and The Sunday Telegraph in the United Kingdom.

The ads said Facebook is limiting the data apps received when users sign in. It's also investigating every app that had access to large amounts of data. ``We expect there are others. And when we find them, we will ban them and tell everyone affected,'' the ads stated.

Cambridge Analytica got the data from a researcher who paid 270,000 Facebook users to complete a psychological profile quiz back in 2014. But the quiz gathered information on their friends as well, bringing the total number of people affected to about 50 million.

The Trump campaign paid the firm $6 million during the 2016 election, although it has since distanced itself from Cambridge. (Source: Economic Times)

HC bars TRAI from penal action against Vodafone

HC bars TRAI from penal action against VodafoneThe Madras High Court has ordered the Telecom Regulatory Authority of India (Trai) not to take any coercive or penal action against Vodafone India, while staying the regulator’s demand that the carrier put all tariff plans on its website, including those offered to retain individual customers.

“There will be an order of injunction restraining the respondent authorities (Trai) from taking any coercive and/or penal measures against the petitioner (Vodafone) for non-compliance of paragraph 4(d) of the impugned communication being F.No.301-7(27)/2017-F&EA, dated March 7, 2018,” said the order, a copy of which was seen by ET.

“All questions, including that of territorial jurisdiction of this court to entertain the writ petition, are kept open,” said the bench comprising Chief Justice Indira Banerjee and Justice Abdul Quddhose.

The court will now hear the matter on April 13. It gave Trai time till March 28 to file counter-affidavits and till April 6 to file rejoinders. The interim order effectively allows India’s number 2 telco — and possibly older carriers Bharti AirtelBSE -0.59 % and Idea CellularBSE 1.44 % — to give segmented offers to specific subscribers whom it wants to retain, without offering that plan to other users, till the case is settled.

“A high court order is higher than a tribunal... the telcos have to bring the order to the tribunal’s notice,” said a senior lawyer, asking not to be named. This relief, experts say, is critical to incumbents’ efforts to fight off Reliance Jio’s attempts to poach their subscribers. People familiar with matter added that Vodafone has also filed a caveat in the Supreme Court on Saturday, asking to be heard before any interim order, in case Trai appealed in the apex court. Vodafone did not respond to ET’s queries.

Vodafone India had challenged Trai’s tariff order of February 16, which changed the method for identifying what was a predatory offer and altered the definition of significant market power (SMP), giving pricing flexibility only to operators with less than 30% of the market’s subscribers or revenue, while scrapping volume of traffic and network capacity as criterion. The order also barred customised offers to specific subscribers and mandated them to make public all plans.

Bharti Airtel and Idea have also separately challenged the tariff order in the telecom tribunal, saying it curtailed their rights to fight for customers, and thus violated their right to conduct business. While the Telecom Disputes Settlement and Appellate Tribunal (TDSAT), in its hearing on March 5, didn’t grant them any immediate interim relief to Airtel and Idea, legal experts say the latest order of the Madras High Court could help the two carriers in their battle in this specific matter. TDSAT will next hear the matter on April 17.

Experts add that the order could specifically benefit Bharti Airtel, which has also been issued a separate show cause notice by Trai on March 16, asking it to share details by March 25 on its non-transparent and discriminatory tariffs. Bharti Airtel and Idea did not respond to queries as of press time. (Source: Economictimes)

Airtel, Idea move telecom tribunal against predatory pricing order

Airtel, Idea move telecom tribunal against predatory pricing orderBharti AirtelBSE -1.58 % and Idea CellularBSE -1.08 % have challenged the telecom regulator’s recent tariff order on predatory pricing in the telecom tribunal, setting the stage for another legal battle between India's older carriers and the sectoral watchdog who have been at loggerheads for more than a year now. India's first and third ranked telcos have argued that the February 16 order was unconstitutional as it prevented them from retaining customers and conducting business, people familiar with the matter told ET. They added that the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) will hear the pleas this week with Bharti Airtel’s plea likely to be heard on Monday.

An Idea Cellular spokesperson confirmed the legal step, but did not share details, while Bharti Airtel did not comment to an ET query seeking confirmation. The battle lines are now drawn starkly, with the Telecom Regulatory Authority of India (Trai) on one side and incumbent telcos on the other. India’s top three operators – Bharti Airtel, Vodafone India and Idea Cellular – contended the rules favoured new entrant Reliance Jio at their expense, allegations that Trai and Jio termed baseless. The regulator has, in fact, said the companies were free to move court to challenge the order.

On February 16, Trai issued a tariff order that mandated a new formula last month to identify predatory pricing and changed the definition of significant market player (SMP), giving pricing flexibility only to operators with less than 30% of the market’s subscribers or revenue. Earlier, the SMP parameters included volume of traffic, including data, and switching capacity, which have been dropped in the amended regulation.

Trai added that predatory pricing will be determined on a carrier’s average variable cost and that telcos cannot offer pricing packages to individual subscribers to retain them without offering all customers the same tariff plan. Due to change in definition of predatory pricing and in SMP, incumbents said they were straitjacketed to respond to below cost tariffs from competition without flouting the new rules.

Jio has 13-14% share of revenue and users, while Airtel and the Vodafone-Idea Cellular combine would each have over 30% revenue market share. Therefore, the new rules on predatory pricing favoured Reliance Jio Infocomm, Vodafone Group CEO Vittorio Colao said last week, adding that the order should be challenged in court. Vodafone’s India arm is close to completing its merger with Idea Cellular.

It's not yet clear if Vodafone has filed a legal challenge as well. The company didn't respond to an emailed query seeking comment. Bharti Airtel chairman Sunil Mittal said the regulator’s order did not leave any path save legal challenge for incumbents, as the order violated the right for entities like itself to do business which was enshrined in the Constitution, under Article 14.

“If you are my customer and I need to hold you back, then I must have the right to do so with whatever tools I have,” Mittal said.

However, Trai chairman RS Sharma said the companies would be within their rights to take a legal recourse to challenge its regulation in court, and called it the “appropriate forum” to do so.

“India is a free country and every individual, entity or company has the right to go to court and we have no issues, reservations or objections if the Cellular Operators Association of India (COAI) challenges our regulation in court since that is the appropriate forum to do so, and we welcome it.” (Source: Economic Times)
No question of apologising to RJio, says COAI

No question of apologising to RJio, says COAI‘Differences are with TRAI, not with an individual firm’ BARCELONA, FEBRUARY 25
S Ronendra Singh The fight between Reliance Jio Infocomm and the Cellular Operators’ Association of India (COAI) has travelled beyond the shores. On the eve of the Mobile World Congress here, COAI insisted it will not apologise to the Mukesh Ambani-owned telecom company. Speaking to BusinessLine here, Rajan S Mathews, Director General, COAI, said: “I will not apologise. There is no question of apologising to Reliance Jio, as there is no worthy reason to do so. The COAI’s differences are with the Telecom Regulatory of Authority of India’s (TRAI) order, not with any specific operator.”

Both the parties have been trading charges for the past week, with RJio sending a letter to COAI, asking Mathews to apologise for his comment in a press release.

Monopoly charges
Mathews had said TRAI’s latest order on tariff plans are focused around ‘one particular operator with deep pockets’ and monopolistic designs at the expense of other operators. Although COAI did not name RJio, it was clearly pointing to the company’s plans and offers aimed at wooing customers.

RJio wrote to COAI and its senior members, asking Mathews to apologise publicly within 48 hours, saying the press release had made “defamatory statements against RJio”. The letter was sent on February 22 and and it now well beyond 48 hours.
When asked about not responding yet to the letter, Mathews said: “We believe the industry is going through a tough time, and it is important to raise issues and point our serious reservations about the TRAI order in the interest of the industry. We are still examining Jio’s letter and are in discussions with our legal counsel and our members to take a call on whether a response is warranted.
“Our differences are with the orders of the regulator and not with any specific operator. Our intention is not to aggrieve any particular operator.”

He further said “individual operators” are free to vigorously pursue the interests of their enterprises under the framework of the laws of the land. “However, the regulator’s (TRAI) role is to ensure the competing claims of companies are appropriately handled in the interest of the entire industry. This is the mandate of the TRAI Act, which specifically tasks it with ensuring the orderly growth of the industry,” he said.

“We’d also like to put on record that all our other member operators are unanimous in their support of our position, with absolutely no exceptions. Our endeavour is to work towards actualising the Prime Minister’s vision of a fully connected and empowered Digital India,” he added. (The Hindu BusinessLine)

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