Top telecoms ask TRAI to impose floor price on voice and data

TRAI chairman
Several Indian telecom service providers have suggested Telecom Regulatory Authority of India (TRAI) for imposing a floor price for voice and data services.

The objective behind the suggestion was that no operator can offer data and voice services below that price.

The main strategy of top Indian telecom operators is to avoid competition from Reliance Jio Infocomm that offered free voice and data services from September 2016 as part of its promotional offer.

TRAI chairman RS Sharma had after a two-and-half-hour meeting with representatives of seven telecom companies. Telecom operators have also discussed the worsening health of the telecom sector with the regulator.

“Ultimately, 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,” said TRAI chairman RS Sharma.

“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,” RS Sharma said.

Sharma did not mention any timeline by when the telecom 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.

Bharti Airtel, Vodafone India, Idea Cellular, Reliance Communications, Reliance Jio, Aircel, Tata Teleservices, MTS, BSNL and MTNL attended the meeting.

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 percent. They also asked for lowering of Goods and Services Tax rate of 18 percent 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.

Gopal Vittal, managing director and CEO (India and South Asia), Airtel; Anshuman Thakur, head – Strategy and Planning, Reliance Jio; Sunil Sood, CEO, Vodafone India; Himanshu Kapania, MD, Idea Cellular; AN Sethuraman, director, Reliance Communications; Kaizad Heerjee, CEO and MD, Aircel; and N Srinath, MD, Tata Teleservices were part of the meeting.

The regulator also received a number of suggestions regarding interconnection usage charges (IUC). TRAI will hold a one-day workshop on the IUC with telecom service providers 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.