Reliance Jio Infocomm throws down the gauntlet

Asks incumbents to fight battle in the market rather than indulge in disreputable practices

March 08, 2013 02:43 am | Updated 02:43 am IST - NEW DELHI:

Mukesh Ambani

Mukesh Ambani

Repudiating allegations of the Department of Telecom giving ‘undue benefits’ to it, Reliance Jio Infocomm, on Thursday, dared incumbent GSM operators to face competition in the open market rather than ‘indulging in any disreputable practices’.

In a letter to Telecom Secretary R. Chandrashekhar, Mukesh Ambani-led Reliance Jio Infocomm (RJIL) has alleged that GSM industry body Cellular Operators Association of India (COAI) is working for selfish and short-term interests of its members.

“Rather than working for selfish and short-term interests of its members, we would also like to appeal to COAI to work only in the interest of the nation and end-consumers by fighting out the battle with the competitors in the open market rather than indulging in any disreputable practises,” it said in the letter.

RJIL, formerly Infotel Broadband, holds pan-India wireless broadband spectrum which it acquired through auction in 2010. RIL later acquired Infotel Broadband, and renamed it as Reliance Jio Infocomm.

Inter-ministerial body Telecom Commission last month had approved a recommendation that allows companies having ISP licences and holding 4G spectrum to offer phone calls services by paying a fee of Rs.1,658 crore each. Sources said the Telecom Ministry had given its approval to the commission’s decision.

Earlier this week, COAI had alleged that the Telecom Department was trying to give ‘undue benefits’ to Reliance Industries by allowing companies having ISP licences to offer voice calls by paying ‘a small fee’’ of Rs.1,658 crore each.

Commenting on COAI allegations, Mr. Chandrashekhar said, “This impression that voice services are being allowed now, and were not allowed earlier itself is wrong ... the spectrum itself did not have limitation. Terms of the auction allowed you to provide voice services depending upon the licence.”

Terming as “factually incorrect” the allegations of arbitrary changes brought in by the government in the conditions of guidelines, RJIL said implementing a unified licensing regime was an independent matter.

The Reliance letter said COAI had “supported introduction of unified licensing regime during the consultation process, and had submitted that ‘COAI favours framework of unified licensing and class licence, for moving to a holistic licensing regime.’’

“Now, such a sudden change in its stance by COAI is motivated,” it added.

On the BWA auction held in 2010, RJIL said the spectrum that was auctioned is de-linked from the licence. Licence was to be procured separately, which, inter alia, governs the scope of the services that can be provided by the use of the awarded BWA spectrum, including unrestricted mobile voice services.

“We would thus like to clarify that voice service was always allowed to be provided by using BWA spectrum provided one holds or obtains the relevant licence,” it added.

RJIL alleged that COAI is trying to delay implementation of the “long—standing unified licence regime and draw undue benefits for their members“.

It asserted that there is no link between implementation of unified licence regime and migration of existing licences including ISPs with BWA spectrum with the violation of the licence conditions by the UAS licensees holding 3G spectrum.

RJIL claimed “the exit of competition from the cellular market has been exploited by the incumbents (remaining telcos) to increase the tariffs arbitrarily to the huge disadvantage of the consumers at large.”

When contacted, COAI Director General Rajan S Mathews said, “I believe our track record to date needs no apology! What we object to is the entry via the ‘back door’, thus creating an uneven playing field.”

He said that COAI stand by the issues, points and representations made in its letter to the DoT.

“This is an instance where the whole industry — both COAI and AUSPI— stand together and agree on this issue. So, the citizens need to ask and understand who is truly working in their interest,” Mathews said.

COAI represents GSM players like Bharti Airtel, Idea Cellular, Vodafone and AUSPI represents telecom players like Reliance Communications, Tata Teleservices, Sistema Shyam among others.

No immediate comments were received from AUSPI on the matter.

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