Exempt telcos with under 15% market share from floor price norms: BSNL, MTNL to Trai

NEW DELHI: State-owned BSNL and MTNL have informed the sector regulator Trai that tariff fixation needs to be relevant solely on telcos with greater than 15 per cent subscriber base in a service space, whereas these with decrease or negligible person base needs to be exempt from the purview of minimal flooring value.

It is pertinent to say right here that Bharat Sanchar Nigam Ltd (BSNL) – which operates telecom providers throughout India besides Delhi and Mumbai circles – has about 10.three per cent market share in all India mobile subscriber base. Mahanagar Telephone Nigam Ltd (MTNL), current in Delhi and Mumbai, has 0.29 per cent mobile market share, as per the most recent Trai information.

Reliance Jio leads the India mobile subscriber market with a share of 32.1 per cent, whereas Bharti Airtel and Vodafone Idea have 28.43 per cent share and 28.89 per cent share on an all India foundation, respectively.

In their recommendations to Trai, the 2 public sector operators have acknowledged that the telecom trade is going through warmth because of sudden and sudden entry of “capital rich telecom service providers” providing free and extremely low tariffs, resulting in closure of many gamers and that the scenario has bought compounded by corporations required to make large Adjusted Gross Revenue (AGR) payouts after the Supreme Court order.

“…the telecom industry needs a helping hand – at least in the immediate short term – from the authority to survive ,” the 2 corporations have informed Trai in practically similar submissions.

The two have batted for fixing of flooring costs by Telecom Regulatory Authority of India (Trai) however with a rider.

“…the fixing of floor price should be limited and applicable to Telecom Service Providers (TSPs) having a minimum subscriber base of 15 per cent in that LSA (Licensed Service Area) otherwise floor price may wipe out the prospective new TSP/TSP having small customer base from the telecom business altogether,” BSNL and MTNL have stated.

They added that to mitigate the current stress and to make sure adoption of future applied sciences, BSNL and MTNL each assist the regulatory intervention for tariff fixation of the Trai with situation that operator with 15 per cent or much less market share in that LSA be exempt.

The operators require a minimal buyer base to stay viable and survive, BSNL and MTNL have reasoned of their feedback submitted on Trai session paper on “tariff problems with telecom providers”.

“Considering the financial health of the telecom industry and demands of major telecom service providers, BSNL feels that there is a need for a change in Trai policy of forebearence in tariffs as a short term major,” BSNL stated.

The state owned telecom corporations have additionally stated that though the operators have hiked their tariff not too long ago, they continue to be prone from one another to take care of their buyer base.

Even with the rise in tariffs the Average Revenue Per User (ARPU) ranges are beneath the degrees wanted for long run survival, they felt.

The two have favoured fixation of flooring value based mostly on common trade prices, and added {that a} markup of minimal 25 per cent or as authorised by Trai above the present trade value.

BSNL and MTNL of their separate submissions have stated no matter the parameters used to repair the ground costs, Trai ought to be sure that the train doesn’t lead to windfall earnings for a couple of operators.

They have stated that flooring costs needs to be fastened for mobile information providers – utilized uniformly to completely different class of subscribers.

The public sector operators have additionally stated that flooring value must also be put for voice calls and SMS – a place completely different from personal telecom operators.

“In the present competitive situation, the tariff for voice calls have been worst causality and therefore it cannot be left without the intervention of the authority. In fact, the need to fix floor price for voice calls is as strong as for mobile data,” BSNL and MTNL have stated.

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