1. From PMO to Bharti Airtel

From PMO to Bharti Airtel

Both losing perception battle, need to work on it.

By: | Updated: April 15, 2015 11:30 PM
PMO, bharti airtel, narendra modi, narendra modi news, PMO bharti airtel, prime ministers office, land acquisition Bill, airtel zero, pmo land acquisition, economy news

Prime Minister Narendra Modi is trying to address the perception problem through radio talks and by getting his ministers to constantly address the land Bill issue at every chance they get. (PTI)

On the face of things, there is little common between the Prime Minister’s Office (PMO) and telecom major, but both are losing the perception battle – the PMO on the land acquisition Bill and Bharti Airtel on its Airtel Zero product. None of this has to do with the intrinsic properties of their propositions – the land Bill will benefit the country, including farmers, and Airtel Zero allows those without data plans to access certain websites/apps with the payments to be made by companies such as Flipkart (before it withdrew). Mobs, however, are easy to incite/create, especially in the time of the Internet 2.0 where 140 characters and hashtags rule, not cold logic. India’s farmers are migrating to cities for better wages and you need land to build cities for them – you need even more land for creating irrigation facilities for those left behind, but try telling that to the mobs egged on by political parties like the Congress and the Trinamool. Or take replacing the current system of subsidies where less than half reaches the poor – direct cash transfers are far better, but you can get 30 crore signatures (roughly the number of poor in the country) to sign a petition against this since smart campaigners will convince the poor that their rights are being bartered.

As FE has been arguing repeatedly, net neutrality sounds very good, but if OTT players like Skype and WhatsApp eat into the revenues of the Bharti Airtels and Vodafones, the latter will either stop rolling out networks for 85% of Indians who don’t have access to the internet or will hike data tariffs for everyone – a more just solution, naturally, would be to charge higher rates for the OTT players while keeping rates low for the bulk of the population which just wants to surf the net looking for data or to buy/sell their produce. And, in any case, in which industry, from airlines to electricity, aren’t differential tariffs the order of the day? Airlines charge differential rates on the same aircraft and governments/regulators encourage subsidized tariffs for households and over-charging trade/industry to make up for this.

While Prime Minister Narendra Modi is trying to address the perception problem through radio talks and by getting his ministers to constantly address the land Bill issue at every chance they get, Bharti Airtel is fighting a lone battle. Since this is a very public issue and will even figure in Parliament, the battle cannot be won by talking to individual bureaucrats/ministers. Telcos need to unite and run a very public battle – to get internet-less consumer groups behind them, to explain to them and the government that voice calling on WhatsApp is not cheaper because of altruism or a great technology – it is because WhatsApp doesn’t pay a 15-16% license/spectrum charge or a 34% corporate tax. It was a similar battle – with combined press conferences of telecom CEOs and full-page newspaper advertisements – that a united industry fought between 2001 and 2003 when the government was hell-bent on providing a back-door mobile phone entry to Reliance and the Tatas. At one time, the cellular mobile industry even cut off access to these telcos, forcing the then telecom minister to cut short an overseas trip. This forced the government to level the playing field by also giving cellular telcos calling-party-pays rights and by charging Reliance/Tata the same license fees the Bharti Airtels had paid. While telcos are deeply divided, they can win only by playing a united and high-decibel game, exactly the way US telcos are playing. Mark Zuckerberg getting into the game to defend his internet.org, an Airtel Zero kind of product, will help a bit, but Indian telcos need to do the heavy lifting themselves.

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  1. N
    Net neutral
    Apr 16, 2015 at 12:30 am
    How much did Airtel pay the author?
    Reply
    1. Abhishek Batra
      Apr 16, 2015 at 9:07 am
      The justifications for differential rates given by the author does not make sense. 1. "Skype and WhatsApp eat into the revenues of the Bharti Airtels" - Leaving aside the bad grammar, this argument is similar to "Vodafone is eating into Airtel's revenues." 2. "latter will either stop rolling out networks for 85% of Indians" - This is clearly a threat that Airtel paid the author to slip in. 3. "in which industry, from airlines to electricity, aren’t differential tariffs the order of the day?" - They apply differential tariffs on products and services that they provide! Tomorrow banks will say that nothing will work if we don't exist and so we'll give people different interest rates on their savings account depending on the company that employs them. 4. "WhatsApp doesn’t pay a 15-16% license/spectrum charge or a 34% corporate tax" - That applies to any internet based service! And if that is all that concerns your Bharti Airtel, then they should fight exactly that or switch to internet telephony themselves. Of course they can't choose the second option because they're just not good enough (Hike Lol).
      Reply
      1. J
        Jay
        Apr 16, 2015 at 11:05 pm
        "WhatsApp doesn’t pay a 15-16% license/spectrum charge or a 34% corporate tax." -->Whats app doesnt charge billion indians to access its services(except for the yearly fees :p ) . Rest Arguing that OTT services dont help Telecos get more data revenue is absurd.
        Reply
        1. Jayasankar
          Apr 16, 2015 at 11:32 am
          Vodafone and Airtel arguments does not have any Sense. Their aim is to only make money and more and more Revenue to them.It is time PMO should not bow to their wishes.. If Telecom Minister says Airtel must Switch over to Min 2Mbps broadband (Optic fibre cable to its all its Customers) with unlimited download , will they Listen?. Nonsense. Mr.Ravishankar Prasad Telecom Minister should not sucb to their pressure. PMO must now put Pressure on the Teleco Companies to Switch over to Optic fiber with in one year , then these Airtel and Voadfone will shut their Mouth.
          Reply
          1. C
            Chinmaya
            Apr 16, 2015 at 2:57 pm
            Completely biased article - a) There is no relation between the land acquisition and the net neutrality issues. So the author is unnecessarily trying to create an image that those pro-net neturality are just illiterates or "mobs" that do not understand anything while the "wise" see the benefits of breaking net neutrality. b) The argument that the OTT services are eating into the revenues of Airtel & Co is so stupid. This is innovation: it is obviously disruptive. This is how you "ate" into revenues of state owned BSNL landline because you could offer a new service at a cheaper cost. c) Spectrum costs: I don't know why everytime an argument about net neutrality in India goes to the spectrum costs. These costs haven't been forced by the government on the telecom companies, but pa willingly by them. If it is unviable, then don't pay it. Regardless, why should OTT services pay for the spectrum costs, any more then other web applications should? What is the data charged to consumers for? d) Differential tariff for electricity: Another stupid point. Yes, there is differential tariff for electricity but the tariff remains the same regardless of what user uses the electricity for. I am not advocating an extreme position that the status quo should be maintained but I would expect articles by "wise" people to atleast explain how regulation of OTT services has happened in other countries, so that both telcos and OTTs can live with each other in harmony. Nobody wants to go a regressive age of using SMSs and international calling cards again for no reason but to protect the pockets of the telcos.
            Reply
            1. D
              Devi
              Apr 16, 2015 at 5:15 am
              Why to drag PMO and Land Bill to justify Airtel's business decisions?
              Reply
              1. S
                Sai Pramod
                Apr 16, 2015 at 10:13 am
                Irrelevant article, Airtel does this for its margin expansion not with any social intent. PM does it for the country's unemplo. Dont compare
                Reply
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