Reportedly when Reacting to the Telecom Regulatory Authority of india (TRAI) floating a consultation paper on fixation of floor prices, analysts say it opens up room for more tariff hikes. Meanwhile citigroup said in a research note that the introduction of floor tariffs is likely to be perceived as positive as it could potentially open up room for further tariff hikes.
Perhaps while implementing this could be a lot more complicated and challenging, all three operators are seemingly on the same page, which might make it more probable, it noted. TRAI has issued a consultation paper on 'tariff issues of telecom services', wherein it has raised questions regarding the need to fix a floor price. TRAI has nonetheless noted that telcos have already taken huge tariff increases, thus questioning the need for floor price, ICICI Securities said in a research note.
Reportedly "While we shall watch how floor prices shape up, we remain enthused by any effort to drive higher ARPU". Furthermore COAI in its representation has stated that the tariff correction in the current level of fierce competition is not possible by any service provider voluntarily and thus the only option available is prescription of a minimum tariff for mobile data service by the Authority. Apparently COAI also submitted that all the current telecom service providers in the private sector, namely Bharti airtel, reliance jio and Vodafone-Idea Limited, are in complete agreement that TRAI be requested to regulate tariffs by setting floor price for data services.
