Top telcos including Bharti Airtel, Idea Cellular have moved the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) challenging the telecom regulator TRAI’s recent tariff order on predatory pricing.
The telcos say that the February 16 order was unconstitutional as it prevented them from retaining customers and conducting business. They added that the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) will hear the pleas this week with Bharti Airtel’s plea likely to be heard soon.
Now TRAI will have to fight against the incumbent telcos – Bharti Airtel, Vodafone India and Idea Cellular. The telcos contended the rules favoured new entrant Reliance Jio at their expense. Jio rubbished the accusations.
On February 16, the regulator issued a tariff order that mandated a new formula last month to identify predatory pricing and changed the definition of significant market player (SMP), giving pricing flexibility only to operators with less than 30% of the market’s subscribers or revenue. Earlier, the SMP parameters included volume of traffic, including data, and switching capacity, which have been dropped in the amended regulation.
The regulator added that predatory pricing will be determined on a carrier’s average variable cost and that telcos cannot offer pricing packages to individual subscribers to retain them without offering all customers the same tariff plan. Due to change in definition of predatory pricing and in SMP, incumbents said they were straitjacketed to respond to below cost tariffs from competition without flouting the new rules.
Now TRAI will have to fight against the incumbent telcos – Bharti Airtel, Vodafone India and Idea Cellular. The telcos contended the rules favoured new entrant Reliance Jio at their expense. Jio rubbished the accusations.
On February 16, the regulator issued a tariff order that mandated a new formula last month to identify predatory pricing and changed the definition of significant market player (SMP), giving pricing flexibility only to operators with less than 30% of the market’s subscribers or revenue. Earlier, the SMP parameters included volume of traffic, including data, and switching capacity, which have been dropped in the amended regulation.
The regulator added that predatory pricing will be determined on a carrier’s average variable cost and that telcos cannot offer pricing packages to individual subscribers to retain them without offering all customers the same tariff plan. Due to change in definition of predatory pricing and in SMP, incumbents said they were straitjacketed to respond to below cost tariffs from competition without flouting the new rules.
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