Vodafone Idea has opposed Reliance Jio’s pitch to shut down 2G services in the country through a regulatory mandate. It said, any forceful shutdown of 2G will move low income and marginal consumers away from accessing basic telecom services, thereby increasing the digital divide.
“There is a larger public interest which is being fulfilled through continuation of such older technologies. Any decision to shut down older technologies must be taken after keeping in mind the interest of consumers, as is being done in case of 3G,” Anjali Hans, senior vice president – regulatory & corporate affairs, said in her counter comments to the Telecom Regulatory Authority of India (Trai) on the consultation paper on digital transformation through 5G ecosystem.
Vodafone Idea’s comments assume significance as there are about 200 million 2G users in the country. While Airtel and Vodafone Idea also provide 2G services, Jio’s network is fully on 4G from the start. Of the 215 million mobile users, Vodafone Idea is estimated to have around 96 million 2G users. On the other hand, Airtel’s 2G users are expected to be around 100 million out of its total wireless base of 345.5 users.
In fact, the telecom operator has recommended that instead of any regulatory mandate for shutting any particular technology, there should be a central and pan-India based handset subsidy scheme. Such a scheme will support migration of feature phones to smartphones through respective operator, the company said.
Lately, Reliance Jio in its submission to Trai said that “the Government should come out with a policy and glidepath for closing down the 2G and 3G networks completely so that unnecessary network costs should be avoided, and all customers can be migrated to 4G and 5G services”.
Jio’s argument behind mandatory shutdown of 2G services was backed by the fact that the same will also give great impetus to develop the ecosystem for 5G use cases.
“There are huge number of consumers who are using 2G networks, despite having extensive 4G coverage available. The primary reason can be attributed to the cost of migration from feature phone to smartphone as the consumers using 2G networks would largely be in the lower income bracket,” Hans added.
According to Hans, a forceful shutdown of 2G will also affect point of sales (PoS) and loT devices like ATMs, etc, which run on the 2G network, and in certain cases it may not be even able to change the equipment to be capable to latch onto 4G network. Such a scenario can have severe consequences as availability of various services is dependent upon loT devices and 2G networks, she said.
In the October-December earnings call with analysts on Tuesday, Airtel CEO Gopal Vittal said, “the 2G contribution to our business now has become quite small. It’s in the ballpark of around 17%, and in markets like Gujarat, Maharashtra, Kerala, Mumbai, Delhi, they are in single digits”.
According to Vittal, over the next few years there will be a substantial reduction in 2G users because of migration to higher technology.