Steep hike in phone call rates inevitable

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Follow us:WhatsappFacebookTwitterTelegram.cls-1{fill:#4d4d4d;}.cls-2{fill:#fff;}Google NewsTelecom Regulatory Authority of India (TRAI) justified that if prices for essential commodities had seen steep rise in recent years then it was inevitable that mobile call tariffs would go up as well due to the state of the industry.During an interactive session with members of the Federation of Karnataka Chambers of Commerce and Industry (FKCCI), Rahul Khullar, chairman of the regulatory body said that steep price hike was almost imminent and ‘everybody should wake up to reality’.Stating that consumers had enjoyed low prices for a long time, he said that the industry was going through hardships and they were justified in increasing tariffs to reduce losses. “Telecom Service Providers (TSP) cannot continue to work with red ink on their books,” he said and added the losses of telecom industry had a cascading effect on other financial institutions.Commenting on their recent recommendation of Rs 18,000 crores for 5 Mhz of spectrum (reserve price) being lowered to `14,000 crores by the government, he said that their opinion was not binding on the government who had the right to modify the reserve price.On whether the auctioning of 2G spectrum would be successful, he said that there was enough reason for it to be successful as many would be bidding for the same. Stating that the industry had not approached TRAI, he said they had already presented their reasoning and calculations for their reserve pricing.He said as regulators, they would have to look at both sides (consumers and TSP) to ensure that they provide balanced view. On competitive or predatory pricing, he said that the competition was so extreme that it was ‘destroying the industry’. When asked Khullar said studies on the effects of radiation would be ready by the year-end.first published:August 14, 2012, 10:20 ISTlast updated:August 14, 2012, 10:20 IST
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Telecom Regulatory Authority of India (TRAI) justified that if prices for essential commodities had seen steep rise in recent years then it was inevitable that mobile call tariffs would go up as well due to the state of the industry.

During an interactive session with members of the Federation of Karnataka Chambers of Commerce and Industry (FKCCI), Rahul Khullar, chairman of the regulatory body said that steep price hike was almost imminent and ‘everybody should wake up to reality’.

Stating that consumers had enjoyed low prices for a long time, he said that the industry was going through hardships and they were justified in increasing tariffs to reduce losses. “Telecom Service Providers (TSP) cannot continue to work with red ink on their books,” he said and added the losses of telecom industry had a cascading effect on other financial institutions.

Commenting on their recent recommendation of Rs 18,000 crores for 5 Mhz of spectrum (reserve price) being lowered to `14,000 crores by the government, he said that their opinion was not binding on the government who had the right to modify the reserve price.

On whether the auctioning of 2G spectrum would be successful, he said that there was enough reason for it to be successful as many would be bidding for the same. Stating that the industry had not approached TRAI, he said they had already presented their reasoning and calculations for their reserve pricing.

He said as regulators, they would have to look at both sides (consumers and TSP) to ensure that they provide balanced view. On competitive or predatory pricing, he said that the competition was so extreme that it was ‘destroying the industry’. When asked Khullar said studies on the effects of radiation would be ready by the year-end.