Idea Cellular will shortly approach the telecom department (DoT) on the Rs 950-crore penalty recommended by the regulator, the Telecom Regulatory Authority of India (Trai) for not providing adequate providing interconnection points to Reliance Jio Infocomm, claiming that the telco has not violated any quality of service (QoS) norms
Responding to analysts’ questions on the penalty slapped by the telecom regulator, Idea Cellular’s managing director Himanshu Kapania said that the telco has complete legal opinion that there is no violation” on the matter.
The telco reiterated that it boosted additional capacity significantly to Jio in the shortest possible span. Kapania said that over 2,000-odd interconnection points were in the execution stage as a lot of work was still pending at Jio’s end. The regulator, Trai, had recently suggested hefty penalties on incumbent telcos- Bharti Airtel, Vodafone and Idea Cellular amounting to Rs 3,050 crore for denying points of interconnect to Reliance Jio. The regulator added that action of these telcos showed “ulterior motive to stifle competition”.
Idea Cellular has recently reported an 88% on-year fall in consolidated net profit in the September quarter, impacted by competitive pressures on the voice and data businesses, the telco said.
Kapania said that Reliance Jio’s impact on Idea’s overall business had been negligible as there were very few port-outs to the 4G entrant. He said that Jio’s launch with free promotional services has increased the multi-SIM usage environment.
Idea Cellular, the executive said, will work towards ring-fencing its high-ARPU customers. He however said that Idea would not react to Jio’s free services as they are offered as part of the promotional phase.
Kapania said that real competition on the tariffs front would start only once Jio starts charging customers. “Once they start charging customers, we could look at competing aggressively on the 4G space with bundled plans,” Kapania said.