Industry body Cellular Operators Association of India (COAI) has cautioned that any situation of duopoly in the telecom market will not be in the best interest of the nation or customers, and asserted that government has ‘vast powers and options’ to address the sector’s issues even in the light of the Supreme Court order.
A day after the Supreme Court rapped the telecom department and companies over non-compliance of its order on payment of statutory dues, Rajan Mathews, director general, COAI, told that, it is up to individual members (companies) to see how they would interpret and comply with the order.
‘We continue to believe that government has vast powers and options to address the issues of the sector even in the light of the SC Order,’ Mathews said.
Stating that he believed it is too early to speculate about Vodafone Idea Ltd (VIL) and a ‘duopoly’, Mathews said, ‘We will need to wait and see how Vodafone Idea will respond’. ‘We have stated before that a duopoly is not in the best interest of the nation, customers or even the industry,’ Mathews said.
While Cellular Operators’ Association of India (COAI) sees plenty of opportunity for mobile operators to flourish, enabling policies and regulations will be key to this, he added. Citing COAI’s position that the industry has to move quickly to a Rs 300 ARPU (Average Revenue Per User) level to maintain its financial health, Mathews said that the SC order only makes this imperative ‘more urgent’.
‘We have stated before that present tariffs are inadequate to sustain the financial health of the sector and the industry has to move quickly to a Rs 300 ARPU number to maintain its financial health. The SC order only makes this imperative even more urgent,’ he said.
On Friday, the SC had directed the managing directors and directors of telcos and other firms to explain why contempt action be not taken against them for non-compliance of its order to pay adjusted gross revenue (AGR) of Rs 1.47 lakh crore to the Department of Telecom.
At present there are three private players in the Indian mobile market, Bharti Airtel, Vodafone Idea and Reliance Jio, besides the ailing state-owned operators BSNL/MTNL. Of the three private players, market analysts consider Vodafone
Idea to be in the most vulnerable position.
After Supreme Court rap, the telecom department on Friday began issuing orders asking firms such as Bharti Airtel and Vodafone Idea to clear past dues immediately. The DoT, which faced the ire of the Supreme Court for putting on hold recovery of dues from
telecom companies, started issuing circle or zone-wise demand notices to firms.
The apex court has asked the companies to clear dues, totalling an estimated Rs 1.47 lakh crore, before the next date of hearing on March 17.
Airtel responded to the DoT order by offering to pay Rs 10,000 crore by February 20 and the remaining before March 17. Airtel owes nearly Rs 35,586 crore, including licence fee and spectrum usage charge, to the government. PTI