At a time when the telecom industry is seeing a lot of free offers, several telecom service providers on Thursday suggested to the Telecom Regulatory Authority of India (TRAI) the idea of imposing a floor price for voice and data.
“The operators today have discussed the idea of creating a floor price for voice and data services. The rationale behind it was that no operator can offer data and voice services below that price,” TRAI chairman R S Sharma said while briefing media persons after meeting with representatives of seven telecom companies, who discussed the worsening health of the sector with the regulator.
Asserting that the meeting with the operators was productive, he said: “Ultimately, the floor price will depend on multiple variants… the technology, utilisation of the network, volumes and many more. It is a complex issue. How do you operationalise this principle … that was another issue. We have agreed with the operator that we will have more deliberations on this issue and probably the tariff principle consultation will see some of those things.”
Sharma did not mention any timeline by when the regulator may arrive at a decision on the floor price.
He, however, admitted that the floor price concept may be contrary to TRAI’s stance of forbearance on tariffs.
The operators present in the meeting were: Bharti Airtel, Vodafone India, Idea Cellular, Reliance Communications, Reliance Jio, Aircel, Tata Teleservices, MTS, BSNL and MTNL. Jio had changed the rules of the game in the mobile market by offering free voice and data services.
Sharma said the operators also sought a cut in licence fees, which are now pegged at 8%. They also asked for lowering of Goods and Services Tax rate of 18% on the industry and suggested doing away of the Universal Service Obligation Fund levied on them.
“Some representatives suggested deferring payment of spectrum charges, but some operators also opposed that. Jio said deferred spectrum charge should be done away with. Their rationale was that because of the comfort which people had of the liability not occurring at present, they do a lot of aggressive bidding,” he added.
Those representing the telecom companies included Gopal Vittal, managing director and CEO (India and South Asia), Bharti Airtel; Anshuman Thakur, head, strategy and planning, Reliance Jio; Sunil Sood, CEO, Vodafone India; Himanshu Kapania, MD, Idea Cellular; A N Sethuraman, director, Reliance Communications; Kaizad Heerjee, CEO and MD, Aircel; and N Srinath, MD, Tata Teleservices.
The regulator also received a number of suggestions regarding interconnection usage charges (IUC). “We have decided to hold a one-day workshop on the IUC with telecom service providers. It will be held in the first or second week of July.”
The other suggestions which came from the operators include promoting wireline connections, facilitating ease of doing business and giving infrastructure status to the telecom sector.
“We have heard the operators… we have heard their views and we stand committed in whatever way to see a healthy industry. We want to see a competitive industry. We want to see an industry which offers quality of service to the customers and we want them to offer affordable services in a sustainable manner,” Sharma said.