Trai Maybe Open to the Idea of Setting Minimum Tariff for Calls and Data to Ensure Viability

Setting up a minimum price for data and voice calls will be a useful thing for the telecom operators as subscribers will get to choose the right option based on the quality of service being provided and not on the backing of cheap tariffs. Reliance Jio has dominated the subscriber addition graph for the last three years and surely floor pricing will have a massive impact on the same.

“In the past, in 2012, I remember they had opposed tooth and nail the Trai’s proposal to regulate tariffs. They said tariffs must be left under forbearance,” Sharma further added.

Trai Will Intervene in Tariffs if There are Any Market Failures

Trai always said that it doesn’t want to involve in the tariffs department because it will be an anti-consumer move. However, if there are any market failures, then it has every right to step in and change that.”But if there are certain market failures, if there are certain aberrations, if one of the objectives, for example, consumer protection, is not being met with, then obviously we will have to think of ways to ensure that these objectives are met with,” Sharma said.

Incumbent telcos Airtel and Vodafone Idea even approached the PM Narendra Modi Cabinet seeking relief. At the moment, Trai did not receive any official information from either the Cabinet or the DoT to introduce floor pricing, but with Trai considering the same, it will be interesting to see how it folds.

“And again they have said in a couple of weeks back, so we will have to consider what to do,” Sharma concluded.

In other news, telcos raised tariffs by up to 40% very recently which may bring some stability to the industry. However, the financial burden on their shoulders will not go away with just 40% hike in tariff prices.