Online Business'TRAI must keep off price wars'
Rajya Sabha MP and telecom entrepreneur Rajeev Chandrasekar on Thursday said the Telecom Regulatory Authority of India (TRAI) should not intervene in the ongoing price war between mobile telecom service providers.
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“At the outset, I am deeply concerned that the TRAI is intervening in a sector, at a time when the market forces are finally showing signs of working. If anything, the TRAI should have intervened years ago when it was clear that the voice and SMS tariffs offered by operators were way above the actual costs of providing such services,” he said.
Chandrasekhar, who sold BPL Mobile to Essar Group, at an enterprise valuation of $1.3 billion, added that the TRAI should have proactively mandated a pay per second regime and lower tariffs for SMS (closer to the cost) rather than waited for operators to do so.
“Now that competition is at work and companies are making enlightened choices about making tariff offers which, for the first time, reflect true costs and a vibrant market, it would be highly ill-advised for the TRAI to intervene to stopping further reduction in tariffs — both voice and SMS,” he stated strongly.
Further, his argument that intervention in the tariffs from TRAI will be anti-consumer, he said any move by TRAI except to further reduce tariffs closer to cost would be anti-consumer and patently against its stated mandate and objectives as outlined in the TRAI Act 1997 and subsequent and well-thought out amendments carried out in 1999.
Chandrasekar further urged that TRAI has to ensure that it does not force any unreasonable orders that adversely impact viability in a manner that could become irreversible. “It is hardly TRAl’s mandate to review what operators will do in the market place based on years of experience and their business case / marketing strategy to access market share. As long as the operator’s actions are not anti·competitive, TRAI cannot be seen to intervene to improve operators’ viability in a free market,” he noted.