Subscriber norms put Rs.1k-cr strain on telcos
It is not only higher spectrum costs that is worrying the mobile operators. Close on the heels of tougher guidelines for selling value-added services (VAS), operators have now been hit by tougher subscriber verification norms, which would put a financial burden of around R1,000 crore on them since they would require employing an additional 5,000-7,000 staff for the purpose.
Beginning November 9, the Department of Telecommunications (DoT) norms for subscriber verification put a stop to the practice of issuing pre-activated SIM cards even after complete application forms and identity proofs are submitted. The operators are now required to physically verify the antecedents of the subscribers by their regular employees rather than through outsourcing. Only after this process is complete can the connection be activated.
These guidelines are in response to the Supreme Court’s direction to DoT and the Telecom Regulatory Authority of India in the wake of security concerns raised by a public interest litigation.
The operators say that this is a double whammy. One, newer customer acquisition would be slowed due to the lengthy and cumbersome process and two, their costs would go up as they would have to employ more staff for the purpose.
“We shared our concerns with the government on how this kind of a lengthy procedure will not only increase costs for the industry but will also cause inconvenience to SIM card applicants by increasing the time,” Rajan Matthews, director general of the Cellular Operators Association of India said.
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