TRAI floats consultation paper to discuss transparency, promotional offers & predatory pricing
Past few months telecom industry has been a hot bed of acrimonious exchange between major telecom operators and latest entrant Reliance Jio mostly related to free offers by Jio and connectivity issues between Jio & incumbent operators. Jio is being accused of offering predatory pricing which is affecting the financial health of the industry and incumbent operators are being accused of being non-transparent in promoting tariffs and indulging in anti-competitive behavior by delaying adequate connectivity with Jio network. Changing competitive environment and evolving tariff structures, technology , consumer profile etc have exposed the loopholes that are present in telecom space and in order to take fresh look on aspects like anti-competitive pricing, transparency and promotional offers telecom regulator TRAI has brought a new consultation paper on ‘ Regulatory Principles of Tariff Assessment’.
TRAI manages issues related to tariffs through Telecommunication Tariff Order( TTO) since 1999 and have introduced sixty two amendments till now for various issues related to tariffs. But recent developments have shown that there is a need to discuss and define predatory pricing , promotional offers , significant market power, anti-competitive behavior , non-discrimination and promotion of tariffs in today’s perspective.
TRAI mentions that transparency is still a concern even after so many regulations as they continue to receive complaints from customers and therefore more steps are required to define the scope of transparency in tariffs and its promotion via advertisements. TRAI’S TTO framework was put in place at a time when the telecom sector was primarily voice centric and since then industry has evolved from voice to data, driven by technological and other factors like change in user profile, proliferation of social media, development of innovative content and applications, falling cost of devices etc.
It has asked the stakeholders to share their views on prescribing adequate measures to bring more transparency, define non-discrimination , eligibility of promotional offers, criteria for assessing significant market power and methods to assess predatory pricing till 17th March 2017.
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