Call-drop issue spoils telecom sector party

The telecom sector has a reason to celebrate the year 2015 as the telephone subscribers base has crossed over 100 crore, but the menace of call drops continues to haunt the cell phone users.

With the NDA government taking several steps to bring back the glory of the telecom sector, which was hit by several scams in the previous UPA regime, the sector witnessed several policy initiatives in 2015 including the major announcement of guidelines on spectrum sharing and trading by Department of Telecom.

Amidst the Telecom Department prodding the telecom companies to address the call drop problem, the government is hopeful that the problem will be completely addressed with allotting more spectrum and operators putting up more towers.

The first quarter of this year witnessed spectrum rights getting sold for Rs 1.1 lakh crore and the government has now started preparing for the next round of spectrum auction, which includes sale of most premium radiowaves, likely to be conducted in early 2016.

The new year is also expected to bring more new services for the customers at affordable rates as the government is framing a new policy for additional features on mobile phones, through which customers will be able to communicate in their local languages and access services like e-payment through their phones.

Some of the critical issues like free roaming, neutrality debate and availability of spectrum are likely to take shape in 2016. Though BSNL is already offering free roaming facility to its mobile customers, MTNL is to start the service from January 1, while the government is expecting private service providers to follow the same soon.

Consumers can expect to save on mobile bills with availability of public wifi and pressure to cut Internet rates due to expected entry of pan-India 4G player Reliance Jio.

Reliance Jio is likely to give tough competition in the market in 2016 as it has to work hard to attract customers. Incumbent players including Bharti Airtel, Vodafone and Idea Cellular, were gearing up for the competition and they have launched the 4G services.

Bharti Airtel recently announced an investment to the tune of Rs 60,000 crore in networks over a period of next three years.

Though data usage of consumers is likely to see a significant increase, the spending may not be in proportion to the usage with availability of public wifi. In absence of good margins and competitive pressure, telecom sector has begun looking at spectrum sharing and trading.

The issue of net neutrality is also likely to keep the government and regulator Telecom Regulatory Authority of India (TRAI) busy with the formation of a policy framework.  TRAI has already come out with a consultation paper on differential pricing for data.

The TRAI is also expected to address the issue of over-the-top players like Whatsapp and Skype, as telecom operators are demanding regulatory framework for them also. The telecom operators apprehend that they are losing a major chunk of voice revenue due to calls made through Internet by consumers using OTT player’s platform. Indeed, there is pressure on the government to create a mechanism to ensure flow of investment in the sector for job creation and providing telecom services to the remotest parts of the country.