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Telcos will hike data tariff if parity between VoIP and voice calls is large


Pitching for ‘same service, same rules’, telecom companies have warned of a data tariff hike if over-the-top (OTT) players are not brought under regulations, like the telecom service providers (TSPs).

“We must have ‘same service, same rules’ so that all stakeholders are bound to offer the same services under the same regulations, and no one gets an undue advantage. More importantly, with the advent of VoIP (Voice over Internet Protocol) services riding free on Indian mobile operators’ expensive data network, the voice business, which was absorbing most of the costs of telecom operators, will no longer be able to do so,” Idea Cellular said in its response to the Telecom Regulatory Authority of India’s (Trai’s) consultation on regulatory framework for OTT. “Data prices will have to go up significantly from current levels just to maintain the existing revenue,” Idea said.

“The industry is presently supporting rapid growth in data penetration, as data prices are at affordable levels based on incremental costs. However, if there was only one service, being data, which will fulfill all requirements, then while the voice price per minute may come down, the rate for data will have to be increased multifold from the current 0.25/MB, as explained above. This will hinder growth of data services in lower strata of society and the vision of broadband for all,” said Idea.

“TSPs are liable for a plethora of licensing provisions and regulations that include regulatory levies and licence fees, quality of service, tariff regulations, confidentiality of customer information, regulatory audits, consumer protection regulations, emergency services, privacy of communication and lawful monitoring and interception. These conditions are not imposed on unlicensed OTT players, and the resulting arbitrage allows OTT comm- unication providers to offer internet telephony for free or for a greatly reduced price in comparison to TSPs,” Idea said.

It added that stable voice revenues are key for the future of mobile data growth. “OTT communication players are thus sitting outside the licensing regime and are not burdened by multiple historic obligations that currently apply to TSPs. Absence of any level playing field with TSPs is a source of unfair competitive advantage for OTT players,” it said. “Hence, tariffs need to improve from current levels to first cover the cost of capital and then to cover the higher cost of spectrum post renewal,” said Idea.

“Net equality means that the consumers should be ‘free to choose’. This choice should span across content, device and operators. Consumers should have access to possible solutions that will make internet affordable, such as toll free, sponsored data plans, etc.”


Vodafone India in its response said regulation must be adapted in order to be fit for purpose for this new world. “There are clear advantages to implementing regulations now, when the market is still nascent, so that services have time to adapt and to prevent consumer harm occurring. A new framework should be implemented, which is light touch, encourages innovation, but which is also strong enough to protect consumers and ensure that there is a level playing field in relation to the same services. Essential consumer protection requirements should be the same for all internet and communications services, setting a minimum baseline,” Vodafone said in its response.

“The OTT players are not peering with the TSPs, they are riding on the network created by the TSPs. Thus we believe that it will be wholly inappropriate to draw on the pricing proposals. We believe that the principles of separate regulatory practices for communication services and non-communication services, use of price discrimination on traffic to ensure development of broadband infrastructure, use of a FRAND (fair, reasonable and non-discriminatory) approach in dealing with regulatory issues concerning OTT players should be included in the regulatory framework formulated or proposed by the authority,” said Vodafone.

Source: Express Computer

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