TRAI questions Jio tariff; GSMA seeks 700 MHz band price recalibration

MUMBAI: There has been palpable unrest among the Indian telcos since Reliance Jio disrupted the telecom ecosystem by bringing in lucrative data and voice offers for the price-conscious Indian consumer a few weeks ago. Telecos instantly put together their counter-offers and also made some quick tie-ups to face the newest competition from the late entrant. Blocking inter-connectivity to calls to and from Jio seemed to a part of strategy of some telcos while the regulator TRAI watched from close quarters.

After several meetings with the competing telcos, TRAI has now sought an explanation from Reliance Jio Infocomm over its offer of free-calling as it differed from the Rs 1.20-per-minute voice tariff plan reported to the regulator. Jio officials reportedly may soon make changes in their tariffs, which would be conveyed to TRAI.

TRAI officials discussed with Reliance Jio executives seeking details of the tariff plan, TOI reported. Jio had printed two paise-per-second call plan on its SIM card brochures.

Jio may have to tackle an issue related to an amendment to the 2004 telecom tariff order. Telecom companies cannot have tariffs below the interconnect user charge (IUC), or the charge that a mobile operator pays to another for terminating its calls. The IUC rate is currently 14 paise per minute, while Jio has made calls free.

Telcos had alleged that Jio was engaging in predatory practices by offering free voice calls. However, TRAI did not find any merit in this accusation.

Meantime, GSMA wants the government to revisit 700 MHz spectrum band pricing. Global mobile industry body GSMA has called upon the government to reconsider pricing of 700 MHz band that failed to find takers in the just-concluded auction due to its "unrealistically" high price.

GSMA chief regulatory officer John Giusti, urged the government to reassess the approach to spectrum auction reserve prices after India "failed" to sell any of the critical 700 MHz band last week. The reserve prices for this highly sought-after band were set at an unrealistically high level of more than USD 60 billion (over Rs 4 lakh crore), Glusti said.

GSMA added that high reserve prices inhibit investment or delay deployment in next-generation networks at a time when demand for mobile data is growing mani-fold.

“Regulators should consider the conditions of the local market while setting reserve prices for spectrum auctions. In India, mobile operators have been asked to pay some of the highest rates for spectrum compared to other markets even though it has a low average revenue per user, PTI quoted Glusti's statement.

Urging the Indian government to work with the regulator to recalibrate spectrum pricing, GSMA said that timely deployment of this spectrum will expand the reach of mobile broadband services and deliver positive social and economic benefits to the country’s citizens, creating a truly digital India.

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