Reliance Jio, India’s number one telecom operator in terms of subscriber market share, has called for the need of reducing the license fee charged from 3% to 1%. Note that all the operators have to pay the government a license fee which is 3% of the adjusted gross revenue (AGR). Matthew Oommen, President, Reliance Jio Infocomm, today said that the license fee for the telcos needs to go down to 1% from the existing 3%.
Note that the Cellular Operators Association of India (COAI) had also written to the Department of Telecommunications (DoT) that the spectrum renewal period should be doubled and the license fee (LF) should be brought down to 1%.
Reliance Jio Addresses Changes In Market Since It Came
Speaking at the India Mobile Conclave organised by ET Telecom, Oommen said that almost 60% of the country is online, which is about 800 million people. Further, he said that because of the kind of technology 5G is, the 5G users will triple than 4G in India.
He noted that how India still has over 300 million 2G customers. Reliance Jio has an aim of making India 2G Mukt, and it can only do so if there is enough incentive for the 2G customers to shift to 4G smartphones.
More than just incentives, they need a lower entry-level 4G smartphone with good features. That is why Reliance Jio is going to launch a new 4G smartphone in India, namely ‘JioPhone Next’.
Oommen noted the fact that the license fees for the telcos is too high at the moment, and it is stressing the sector financially. Hopefully, the government can come out with a relief package soon where it will reduce the license fee charged to 1%.
Oommen said that an agile policy and a consistent regulatory framework is needed to fuel the growth of this sector even further. The government’s relief package for the telecom sector might address all this.