The telecom operators of India have been looked at the wrong way by some for moving ahead with tariff hikes. Many have opposed the government for coming out with reforms that helped at least one private telco save its life in the long run. Then some say that the government must not reduce spectrum price as the telcos wouldn’t extend the benefit of a lower cost to the customers anyway. However, things need to be seen with a different perspective if this is how the prevalent mindset of the general population is.
Government Bailed Out the Telecom Sector, Here’s Why
The Indian government bailed out the telecom sector, dominated by private companies, and many find it unsettling. But the question is, why would the centre do that? The reason is to benefit the people living in India.
During the pandemic, one thing became pretty straightforward, and that was just how important access to mobile network services is for each Indian. Had the government not bailed out the sector, it would have been crushed with one of the operators going down and thousands of jobs going down the drain with that.
Further, the duopoly scenario it would have brought to the sector with only two stable private operators in the mix was scary. To ensure that the jobs remain intact and that everyone is provided access to digital services where the market is fair and the competition is regulated in a just manner, the government had no other option but to announce a bailout package for the telecom sector.
Telecom Operators in India Spend a Lot but Earn Very Little
The telcos, just like any other business, need money to operate. Just think, without these private operators, India wouldn’t have such low data rates or nationwide 4G connectivity even in 2021, and that is one scary thought.
Telcos have to spend a massive sum of money to get approvals, build infrastructure, develop services, and expand networks for millions and millions of people living in India; this is not even including the statutory dues they have to pay, research and development costs, and much more. Against that, the companies offer data to the Indian users at one of the cheapest rates despite the tariff hikes.
Many argue that this tariff hike wasn’t justified. But the thing is, despite the tariff hikes, India is still one of the countries where people get data at the cheapest possible rates. Even after the recent tariff hikes, Indians still don’t have to pay what they paid in 2016 for a single gigabyte (GB) of data.
If this is not justified, then what is? Are the telcos going out of business due to cost pressure justified? The thing with most people is, they see things only from the perspective of a consumer. But like everything in life, there needs to be a balance in perspective, and people should learn to see it from the viewpoint of businesses as well.
At the end of the day, a business is made up of people who are getting paid and have jobs because the business is making money. People want quality service, but they don’t want to pay for it. Isn’t there something wrong with this?
Not to be sensitive to people who earn very little, the tariff hikes are hard for them. But there needs to be a balance in what the telcos are spending and what they are earning. The private telcos are running a business, and it is in the nature of a business to make profits, and that is only how they can sustain, grow, and provide better service to consumers while adding to the economy of the country at the same time.
But the operators are still looking after the Indians and still offering one of the lowest data rates in the world.
This is why the operators are asking the government to reduce spectrum prices. It is not with an evil intention to earn more and pass on nothing to the customers. If the telcos benefit from government help, then the customers are getting benefits as well. This is because the more comfortable the telcos are, the more they can sustain with the current tariffs without needing to hike the tariffs.
But there’s no need to be naive and think that the telcos won’t go ahead with another round of tariff hikes. It will happen, not now, but it will happen. But this is why they will also be answerable to people for the quality of services they provide.
The easier the government makes it for the telcos to do business, and the higher the tariffs go, the more the telcos become accountable. The telcos just want to do business and in the right way. What they are asking for isn’t with an evil intention, but with a purpose to grow their business, their sector and provide connectivity to every Indian living in the country.
Be it Bharti Airtel, Reliance Jio, Vodafone Idea (Vi), or Bharat Sanchar Nigam Limited (BSNL), all are important to the country and its economy in an equal manner, despite how they are running their business right now.
