Telcos Reject TRAI Proposal to make Tariffs more Transparent

[Honest 836]

Telcos reject Trai proposal to make tariffs more transparent

NEW DELHI: Mobile phone companies have rejected a proposal of the Telecom Regulatory Authority of India (Trai) to frame new guidelines to make cellphone tariffs more transparent. They have asked the regulator not to intervene on tariff, saying this should be left to market forces, and have also opposed the proposal to have at least one standard tariff plan across all operators. Service providers also said that the regulator should not intervene in fixing a cap for premium SMSs.

In October, Trai had called for increased transparency in tariffs and said it plans to intervene to help customers make informed choices about their mobile plans. The regulator had also said it was examining a plan to impose a cap on the upper tariff limit for premium SMSs (text messages) to ensure that operators, broadcasters and other players do not fleece customers for this facility.

“We are of the view that no further regulations or measures are required to enhance transparency,” the Cellular Operators Association of India, the lobby representing GSM operators, said in its communication to Trai.

The Association of Unified Telecom Service Providers of India, representing CDMA players and dual technology operators, said: “The policy of tariff forbearance has worked well for the telecom market in India. It is suggested that regulated tariff should be resorted to neither in case of value-added services or any other product category and no limit should be imposed on any premium rate SMS services.”

Currently, a mobile phone company can offer up to 25 different tariff plans in a circle and Trai had said it was contemplating a reduction in the upper limit, a move that the industry has opposed. Trai’s reasoning is that that too many tariff plans confuse customers and make it difficult for them to make an informed choice. Trai has pointed out that despite the availability of a large number of tariff plans, “the life plans, which are simple and easy to understand, continue to attract the largest number of subscribers” .

Some operators, however, want this number to be revised upwards, as new tariff plans are slated to be launched with the introduction of 3G services. “There is no reason to believe that the increased complexity by way of more number of plans (choice) available in the market has any which way harmed subscribers’ interest. Rather. it has proved the opposite by reducing the average revenue per user (ARPU) consistently,” Bharti Airtel said.

All operators have unanimously demanded that they be allowed to revise tariffs for ‘lifetime prepaid customers’ . “Price escalation is a fact of life and a normal incident arising out of a gap of time in this inflationary age. The price freeze on all tariff items for lifetime customers without providing a corresponding guarantee that there shall be no increase in the inputs costs is unfair,” Reliance Communications said. It also pointed out that whenever prices of utilities like gas, water, and electricity are increased, it is effective for all consumers irrespective of when a subscriber started using the facility. Similarly, in the case of an increase in tariff for railways, too, the rates were effective from a fixed date.

“The statutory protection against price hike for telecom users is an only exception to this practice,” RCOM said.

The industry’s views are in contrast to those expressed by many consumer groups, which have been seeking active intervention by Trai.

“In the case of the pre-paid category, a majority of customers are very low or medium users. It is, therefore, preferred to have one plan for each service area. It is mentioned that two of the largest operators — Reliance and Tata — have one plan only. This model may be adopted for all service providers,” Telecom Users Group of India, a consumer body, said.

The Consumer Guidance Society has asked Trai to be more proactive. “Awareness and sensitisation of telecom subscribers should be given top priority by adopting a multi .pronged approach by giving a special thrust on rural and semi-literate subscribers as they are the worst affected owing to thrusting of unwanted services and tariff plans by the service providers by adopting unfair trade practices ,” it said.

VOICE, another consumer organisation has sought that “strict financial compensation” should be granted to customers if redressal was not given within a specified period. “Trai should facilitate tariff comparison tool/software on its website wherein all applicable tariff plans are registered to ensure complete transparency. Attention is drawn to the development of software in the year 2004 by Trai using TERI in which such comparison was possible. What is the status of that software and why is Trai not putting the up software on its website is still a big question,” the agency said.

Customer Care

In October, Trai called for more transparency in tariffs and said it plans to intervene to help customers

Currently, a telco can offer up to 25 different tariff plans in a circle. Trai had said it was planning to reduce the upper limit

But COAI has said no further regulations or measures are required to enhance transparency in tariffs

Courtesy : The Economic Times

[Karthik R 246]

It is true that the market is turbulent with operators offering plans that confuse the rational mind of customers. But I guess we dont mind as long as the proportion leads to value addition

[kesav 127]

Transparency & Simplification is very much needed in Indian Telecom Industry. It's very much overdue from TRAI.

It's time for TRAI to ban dedicated(special) account on the validity of bonus talk-time (sometimes called as promotional talk-time).

Why on earth you've validity for talktime when you already have validity for tariff and main account?

Just capricious and absurd !!

[raccoon 53]

Why on earth you've validity for talktime when you already have validity for tariff and main account?

Just capricious and absurd !!

Obviously because the cost is factored by the fact that you have to use that talktime much faster! I'd guess that is how they will calculate the effect on their ARPU! So its not really absurd... but it does make subscriber's life a bit more complicated by having to check/remember multiple validities.