As per Vodafone Idea, the Indian telecom market may move towards a position of “virtual monopoly” if the Telecom Regulatory Authority of India (TRAI) does not intervene in tariff fixation.
The telco’s comments were in response to TRAI’s consultation paper on tariff issues of telecom services.
As per Vodafone Idea, if the existing financial stress in the sector is not addressed within a short period, it could result in further bankruptcy and exit of telecom service providers (TSPs) from the market, leading to a state of virtual monopoly and absence of fair competition in the market. Further, it added that among the telecom companies in the market, the public sector operator has been provided significant financial assistance to sustain itself.
Vodafone Idea also suggested that a floor price must be considered for pure data plans, metered data plans and bundled usage plans and fixed subscription charges for voice only, data only or voice and data subscribers.
The telco added that floor price should also be considered for unlimited usage plan on voice (say plan with 1,000 minutes limit) or data which will construe as a bundled plan and off-net outgoing calls.
Meanwhile, Airtel has cited “huge existential and financial crisis” to bat for fixation of floor price for two years. As per the telco, a temporary intervention by TRAI for a two year period is necessary to ensure orderly conduct and restore the industry. It said that there should not be any specific floor price for voice and voice price may be kept under forbearance.
In contrast, Reliance Jio has termed the fixation of a floor price for data services “vital” for the health of the telecom sector. Further, the operator has also urged TRAI to continue the policy of forbearance for voice services, which according to Jio is the preferred telecom service of the subscribers at the bottom of the pyramid.
Picture credits: Reuters