Trai considers review of policy
Warning that telecom regulator Trai will keep a watch on mobile tariffs, Trai chairman, J. S. Sarma said, “We are coming up with a consultation paper shortly whether its time for us to review the current policy of forbearance (not intervening the market to fix call rates).”
In 2009 as the new players entered market they had slashed their prices to win new customers, which resulted in a major price war in the telecom sector.
The interests of the subscribers is likely to be protected as they can easily shift to other companies thanks to mobile number portability which was launched all over the country a year ago.
Moreover, most of the subscribers were using the SIM cards of these new operators as their second or third SIM and not the primary number as reflected by Trai data on activity. “Subscribers have option to port out through MNP. We will instruct operators to come out with advertisement,” Mr Sarma said.
Airtel and Vodafone will be major beneficiary of the cancellation of new licences. Airtel stocks shot up by around seven per cent on the Bombay Stock Exchange.
“The decision does not affect any licenses owned by the three largest players in the market — Bharti Airtel, Vodafone and Reliance Communications — which may benefit from any reduction in competition,” said Fitch Ratings.
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