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This is an archive article published on June 17, 2006

Tug of war between cellcos, DoP on customer verification

Cost an issue as Posts seeks Rs 30 per verification, only 1% success rate in pilot project

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Checks on prepaid mobile users names and addresses is not proving easy despite the scale in which illegal connections have recently come to light. The Department of Posts (DoP) and cellphone companies are currently debating how much should be paid to postmen who verify pre-paid subscriptions.

All is not lost yet, since the two top telecom associations COAI and AUSPI are putting their weight behind the effort, but mobile companies are increasingly uncertain about how effective the steps taken this far will be.

Telecom industry sources said that a pilot project in which the DoP appointed postmen to round up the subscriber’s names and addresses, the success rate did not cross 1 per cent.

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In April, cellcos had decided to ask the Department of Posts (DoP) to verify subscribers at a cost. These discussions are now cruising towards a sand bank since the DoP has demanded Rs 30 for every verification, but mobile firms only want to pay Rs 15-20.

This suggestion has been turned down by the DoP. But facing increasing pressure from the government on this matter, the Apex Advisory Council for Telecom in India (ACT) on Thursday wrote to all telecom companies asking them to consider the ‘‘finally indicated’’ offer at Rs 30 per verification.

ACT is an association formed by all mobile service firms only to verify subscriber’s identity. It has the COAI and AUSPI heads on board. The firms say that they are keen on verification but would prefer if the government does the job using mass ID cards. The onus by law, however, does falls on companies.

‘‘Since 90 per cent of subscribers are prepaid, it is a huge task. But companies are already verifying post paid connections, are they not? We are going to be very tough on this issue,’’ says AUSPI director general SC Khanna.

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At present the DoP charges Rs 30 per verification from the Election Commission and other bodies, which make it hard for them to relax the rules for telecom players.

On certain points, however, DoP has indicated it will be flexible. These include placing a review/exit clause in its memorandum of understanding (MoU) with ACT. It is also willing to enter circle-wise agreements with operators individually, as long as a ‘Master Agreement’ is reached between DoP headquarters and ACT.

The DoP, however, will not delete an exclusivity clause that limits ACT to seeking verification only from postal department employees. However, the DoP has told ACT that it is willing to consider shortening the exclusivity time period to a year or six months from three years.

Despite the flexibility, a telecom industry source said that the arrangement may not be the best. He said there are 100 million phone users, of which 90 per cent are on pre-paid and will need to be verified. ‘‘At the same time, the sum of all government identity card holders (including ration cards, voter ID cards and Permanent Account Number (PAN) cards) is no more than 120 million,’’ he said.

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The mobile phone companies still have to write back to the postal department on their offer, but since the government has not committed to any central ID card yet, they may have only the choice to accept at hand.

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