BhartiAirtel, Vodafone suggests TRAI to deregulate mobile tariffs

After the recent move of tariff hikes, TRAI - Indian telecom’s regulatory body, has sought responses from industry about reviewing the policy of holding back the tariffs and this consultation has been met with strong replies. India’s two largest GSM players, Airtel Mobileand Vodafone Mobilehave indicated to TRAI in separate letters about their reluctance to be regulated and also highlighted possible backlashes of this move.
While Bharti fears that this move may lead to serious changes in its strategy to expand the Airtel 3G markets in long run, an immediate ripple would be felt in the pricing of Airtel Postpaid Plans.Its letter terms this as a ‘catastrophic’ step.It should be noted that both Airtel 3G and Vodafone 3Ghave failed to launch themselves and a regulation from TRAI would now spell misery for both of them.
Vodafone Mobile has been quite vocal and exhaustive in its reply and while the tone is more courteous, the reply hasn’t failed to remind the TRAI that such a move would be against the laws of World Bank. It has gone on record to demand a ‘Complete deregulation’ of mobile rates. Vodafone has also stressed on the concept of free market economy, its importance and visible benefits.
Airtel Mobile, which boasts of globally fifth largest subscriber base, has conveyed its apprehensions by mentioning how the move will put a huge load on all service’s providers and their profitability. Even after the recent cancellation of licenses in 2G scam, about 7-8 operators are still competing with each other and hence by the World Bank’s standard, it still is a fair game according to Bharti.AirtelPostpaid Plans will not undergo any major change till a final draft of this policy is arrived at. Similarly the structure of tariffs for Vodafone 3Gwill remain unchanged.
March 10 is the deadline for other players to reply with their recommendations and opinions. The uncertainty over this policy will linger on fornow and what remains to be seen is whether the TRAI body will give in to the demands of private telecom sector.