The Telecom Regulatory Authority of India (Trai) has widened its probe into predatory pricing and unlimited offers of all tariff plans — past and current — of all operators. This will include not only their 4G plans (and 5G in some cases) but even 2G and 3G plans.
Officials said the objective is to find out whether the operators have, at some point, violated the regulatory guidelines by offering either “unlimited” plans or indulged in any form of predatory pricing. “It needs to be found out when it all started and who were the first ones to start,” officials said. This will be the first time that the regulator has initiated such a comprehensive probe into all past tariff plans.
Although tariffs are under forbearance, Trai examines them generally a week after the new plans are filed with it. Officials conceded that Trai may have missed spotting any such violations.
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The examination of the plans started with the 5G plans of Reliance Jio and Bharti Airtel upon a complaint by Vodafone Idea that the two were offering unlimited data plans as part of their services. Further, it alleged that 5G services were being offered at 4G rates, saying this amounted to predatory pricing.
However, Vodafone’s plans too will be scrutinised to assess whether it is offering unlimited data plans or did so in the past. The state-owned BSNL’s plans too are being looked into, officials said.
The regulator had decided to direct Jio and Bharti to stop offering unlimited data in their 5G tariff plans but the two telcos have pointed out to Trai that Vodafone Idea has been guilty of the same in its 4G plans. Trai has, however, rejected Vodafone Idea’s allegation that Jio and Bharti are indulging in predatory pricing by offering 5G at 4G rates, as their tariffs are not below cost.
“Vodafone Idea today does not have a significant market share of 30% in majority of the circles but it had in the past. It is therefore necessary to find out whether it indulged in predatory pricing in the past,” officials said. Any order on predatory pricing/unlimited offers need to be all comprehensive, hence the probe has been widened and will look into all the past offers also by the operators, officials added.
As part of the their tariff plans, operators put a cap on daily/monthly data usage by consumers. For example, if 1 GB data limit is provided per day (30 GB/month), and if subscribers consume it before the fresh billing cycle starts, the data speed is lowered, for instance to 64 Kbps.
Upon launching their 5G services, Jio and Bharti did not put such a cap on data usage. Their argument is that the services are not full-fledged today and need promotion and therefore such caps are not required. Even if the caps are placed, it would not make sense since subscribers will not be able to consume their daily/monthly limits, the operators have said.
However, according to Trai, even then unlimited data is against regulatory guidelines and should be stopped.
Allegations of predatory pricing were last levelled in 2017 by Bharti Airtel against Jio when the latter was offering free services as a welcome offer. However, it was dismissed by the Competition Commission of India as well as Trai on the grounds that Jio did not have significant market power (30% market share circle-wise) then.