Tariff Tussle: BSNL Gets The Jitters On Cell Launch Eve

New Delhi: | Updated: Oct 18 2002, 05:30am hrs
As late as Thursday evening, Bharat Sanchar Nigam Ltd (BSNL) was not too sure whether it would be doing a commercial launch of its cellular service or a soft launch on October 19th in Lucknow. The root cause of the confusion is the clarifications sought by the Telecom Regulatory Authority of India (Trai) on the tariff plans proposed by the company.

The Trai sought some clarifications and data on October 10th and 11th. BSNL has already responded, a senior company official told eFE. Based on the ongoing discussions between the company and the regulator, sources said that they were hopeful of tariff plans being approved on Friday.

However, why is the company seeking Trai approval when the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) has already ruled that BSNL does not require its tariffs to be pre-approved by the Trai

Since BSNL had already filed its tariff plans with Trai prior to the TDSAT ruling, we decided to go ahead with the process. We want to go ahead with a clear signal, the official said.

One other explanation for the company seeking the approval of the Trai, which is the sole authority responsible for fixing and approving tariffs, is that the company apprehended that the Trai may intervene in the tariff packages after launch. That could create a messy situation.

The imminent launch of the cellular mobile service of BSNL, a company wholly owned by the government, has caused nervousness amongst the existing industry players who together have about 8 million subscribers as on date. Combined under the umbrella of the Cellular Operators Association of India (COAI), they have often pleaded with the Trai to ensure that no predatory pricing is allowed by large players like BSNL.

To prevent predatory pricing, the Trai, as part of its tariff order for cellular mobile services, said that companies which offer a range of telephony services like basic, cellular and long-distance, would need to get their tariff plans pre-approved by the regulator. BSNL, slated to be the largest cellular mobile operator in the country, felt that this was discriminatory and approached the TDSAT, which ruled in BSNLs favour and allowed it an exit route from the pre-approval clause.