Vodafone Idea defends REDX plan; says telcos under financial stress after catering to growing data needs

By: |
August 12, 2020 5:01 PM

Struggling telecom operator Vodafone Idea has informed the Telecom Regulatory Authority of India that its new pay-more-for-priority-experience REDX plan is just another tariff plan and not a new service.

The Telecom Regulatory Authority of India (Trai) had filed an application in TDSAT, seeking amendments in the interim order, citing that the tribunal’s order had a mistake.The regulator had said that Vodafone Idea and Bharti Airtel should have been informed of it separately before launching their plans.

Struggling telecom operator Vodafone Idea has informed the Telecom Regulatory Authority of India (TRAI) that its new pay-more-for-priority-experience REDX plan is just another tariff plan and not a new service, news agency PTI reported. The telecom regulator has asked Vodafone Idea and Bharti Airtel to clarify what impact their new plans will have on existing customers who do not opt in for their premium offering. Vodafone Idea dragged TRAI to the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) for blocking its premium plan. Although TDSAT has given a stay order in favour of Vodafone Idea, the probe into the plans by TRAI has not been stopped.

The regulator had said that Vodafone Idea and Bharti Airtel should have been informed of it separately before launching their plans. TRAI said that it wanted to examine different aspects of these plans before such services were launched. “”It is not a new service and the service remains the same. A new tariff plan is not a new service,” PTI quoted Vodafone Idea’s reply to Trai on the priority plan.

India’s telecom companies have been competing with each other for a few years now, bringing down costs to record lows. Vodafone Idea in its reply to TRAI said that it has been compelled to not only reduce prices but also make continuous investments in the networks to cater to unprecedented increase in data usage arising out of below costs tariffs. The telco has urged TRAI to consider periodic reporting of its service quality, adding that it should then reach a conclusion on the premium plans. TRAI has also flagged concerns about deterioration in quality of service for non-premium customers which would force them to switch to the premium plan. 

Reports suggest that the telecom regulator was not satisfied by the response it has so far received from both, Bharti Airtel and Vodafone Idea. TRAI has said that it was not against premium plans but wants to ascertain certain aspects of the plans that are being brought into the markets by two of the three major telecom companies. 

Both Bharti Airtel and Vodafone Idea have already been reeling under the pressure of the Adjusted Gross Revenue (AGR) dues that the Supreme Court asked them to pay. Bharti Airtel’s total AGR dues stand at Rs 43,000 crore of which the telco has paid close to Rs 18,000 crore. Vodafone Idea on other hand, has paid Rs 7,800 crore of the Rs 58,000 crore it owes in AGR dues.

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