Indian regulator bars telcos from offering differential tariffs to get new users

differential tariffs regulator
Image by Blan-k | Bigstockphoto

The sector regulator has barred Indian telecom operators – Reliance Jio, Bharti Airtel and Vodafone Idea – from offering differential voice and data service offers to attract customers from each other and directed them to ensure that only official tariff is offered to customers through channels, distributors, retailers and third-party applications.

In a directive to telcos on Thursday, the Telecom Regulatory Authority of India (TRAI) said that such offers are “discriminatory” and contravene current rules around service pricing.

The directive comes at a time when all Reliance Jio and Bharti Airtel have rolled out their marketing campaigns to aggressively acquire new subscribers, especially from struggling telecom operators, Vodafone Idea and state-run BSNL.

Vodafone Idea, which has around 255 million users, has been losing subscribers every month due to its inability to invest the required levels of CAPEX to fight its financially stronger 4G rivals. BSNL, on the other hand, doesn’t have the 4G network at all.

Vodafone Idea lost as many as 12.3 million subscribers in the April-June quarter. During the same period, Jio and Airtel subscriber bases reached 441 million and 321.23 million, respectively.

TRAI said that it received complaints by Indian telcos against each other, where they levelled allegations about mobile number portability (MNP)-specific tariff offering being made by rivals in the market. 

The telecom regulator said some operators claimed that the discriminatory Mobile Number Portability or MNP-specific tariff benefits “may have been given to customers by their channel partners without their consent”.

“…but operators need to realise that since channel partners, distributors, retailers and third-party apps are not licenced entities, it remains the responsibility of telcos to adhere to the regulatory provisions/guidelines relating to tariff offerings,” the regulator said.

In its direction, TRAI also asserted that the responsibility and accountability of ensuring compliance of the regulator’s guidelines and provision would remain with the telecom service providers, where the operators’ name or brand is used for marketing or selling products.

The regulator made it clear that channel partners and distributors are “non-licensed entities” roped in by Indian telecom operators for the purpose of offering services. 

TRAI said that it is the “considered view of the Authority that MNP-specific tariff offers are violative of Clause 10 of TTO-1999, which states that any offering of differential tariff to subscribers porting from a network of another service provider is not a valid and reasonable classification as the motive is to induce churn from the competitors’ network, which is discriminatory.”

Related article: India regulator TRAI bars Airtel, Vodafone Idea offering speed-based plans

Be the first to comment

What do you think?

This site uses Akismet to reduce spam. Learn how your comment data is processed.