Bharti Airtel, India’s leading telco by users has reportedly complaint the Competition Commission of India (CCI) against Reliance Jio. According to various media reports Airtel, in its counter complaint, accused the Mukesh Ambani-led telecom operator of “creating a monopoly for itself” through predatory pricing with intention to kill competition.
Airtel, in a letter dated 2 February to the competition watchdog, said that Jio’s predatory free pricing strategy is to “injure competition”.
“The free service provided by Jio is predatory in nature, which, in accordance with Section 4 of the Competition Act, ex-facie constitutes abuse of dominant position,” Airtel said, adding that added that that it was a strategic business tactic adopted [by Jio] to enhance market power with the objective of eliminating competition which it has succeeded to a large extent during the quarter Oct to Dec 2016 itself.
“The strategy of RJIL is to bind the customer to free voice and minimize competition, including eliminating competition from smaller players, to gain a higher market share. Once RJIL obtains a higher market share, it would likely increase the costs or even charge for voice calls since competition will be limited and the customer will be left with lesser number of service providers to choose from,” Airtel said in its letter.
Reliance Jio however discarded Airtel’s claims. The telco, in an official statement to media, said that Airtel was trying to divert attention from its own violations of rules by not providing adequate points of interconnection to the new entrant and from the regulator’s resultant action against the telco of suggesting levying a hefty fine.
Airtel is also acting against consumer interest by stridently opposing the ‘free voice’ benefit that Jio has been able to provide customers due to its superior next generation IP based technology,” a Jio spokesperson was quoted as saying.
Jio spokesperson added that the 4G entrant’s tariffs have been found to be non-predatory by the regulator, so the question of our offerings being predatory does not arise.
Airtel claimed that Jio is a subsidiary of Reliance Industries Ltd, which is the largest enterprise in India in terms of size, revenues, assets and value, thereby it is a dominant player in telecom space.
Reliance Jio has so far invested over Rs1.60 lakh crore in telecom and spent a Rs47,000 crore towards spectrum alone.