New Delhi: Telecom tariffs are likely to further drop by 25-30 percent over the next year and the market is expected to further move towards lower pricing, as per a report in the Economic Times.
Quoting telecom experts, the ET said that telecom users can expect a double-digit drop in prices owing to the advent of new “business models” that have shaped up amidst the “aggressive tariff war” since last year.
Last week, media reports said that the Telecom Regulatory Authority of India (TRAI) might cut Interconnection Usage Charges (IUC) to 10 paise per minute as against 14 paise per minute for wireless to wireless local and national long distance calls.
TRAI has sought review from various stakeholders regarding this in a consultation paper.
The Economic Survey report earlier this month said Jio's pricing scheme "forced incumbent telecom firms" to cut voice call rates and cost of 1 GB data to average USD 1.9 during January-March 2017.
"Stiff competition, price war, reduced revenue have trapped telecom sector into highly leveraged with interest coverage ratio turning less than 1 since third quarter of 2016-17," the survey said.
Meanwhile, Cellular operators’ body COAI had last month said that said Reliance Jio’s latest pricing will continue to bleed the industry and there is risk of cascading impact on banks and others that have large exposure to the telecom sector.
“The industry will continue to bleed under this pricing, and there is the risk of cascading impact on the banks, government (accruals from licence fee and spectrum payments made by telcos), and equipment manufacturers,” COAI director general Rajan Mathews had told a news agency.
