Telecom Lobby Welcomes Reliance Jio But Questions Ambiguity Around Commercial Launch
COAI welcomes the new kid in the telecom market
Telecom lobby group, Cellular Operator Association of India (COAI), has welcomed the entry of Reliance Jio and the announcement of its commercial launch on Spetember 5, 2016, by calling it a ‘formidable player’.
‘’The price points are very attractive for the end consumer. The package is quite compelling and we wish RIL all success’’, said COAI director general Rajan Mathews, in an interview with Bloomberg-Quint
Many COAI members, incumbent telecom service providers, have refused to provide Reliance Jio full interconnect services in the test phase of the last 2-3 months, accusing Jio of ‘a commercial launch masquerading as a trial’. The stand-off has raised questions over what is a ‘trial’ given the lack of a regulatory definition.
The differences on ‘trial’ versus ‘launch’ persist even as Reliance Industries Chairman Mukesh Ambani announced that Jio will launch commercial services starting September 5, but all voice and data services will be free for all customers till December 31.
Mathew says there is still some ambiguity on that front. ‘’I don’t believe there is complete closure around that. If you look at the announcement made by Mr Ambani, he talked about September 5 date when the offer is going to be available to everyone, plus mobile number portability he indicated should kick in for those who want to port their number. All of those facts indicate it is in fact commercial service. So now what the December 31 date means I am not sure.’’
On its part Reliance Industries has accused COAI of promoting cartelisation. Today in his speech at the Reliance Industries’ Annual General Meeting, Chairman Mukesh Ambani sought cooperation from incumbent telecom players.
Incumbent operators have significant advantages over new entrants, since incumbents have well established networks and existing customers. New entrants require fair access to both. Therefore, the onus is rightly on the incumbent operators not to misuse their market power by creating unfair hurdles, when it comes to providing points of interconnect between their networks and Jio’s network. Such hurdles will serve only to create a poor experience for Jio customers who are trying to make calls to incumbent operators’ networks. In fact, in the last week alone, Jio customers suffered over 5 crores call failures to other networks because of insufficient interconnect capacity provided by incumbents. Giving the impression to common Jio customers that voice is not working, when actually the incumbent operators are deliberately dropping calls. This is the reason why telecom operators have legal obligations, as part of their license conditions, to provide Points of Interconnect to other operators. Likewise, they have an obligation to also not to limit customers’ right to migrate to Jio using Mobile Number Portability.Mukesh Ambani, Chairman and Managing Director, Reliance Industries, speaking at the company’s AGM on September 1, 2016
Ambani appealed to other telecom companies to “do their part, both in letter and spirit, to create a fair and reciprocal framework of co-operation that is good for India and good for Indian customers.”
Mathews says the point of contention between both sides continues to be that Reliance Jio is asking for more connectivity in the ‘trial’period, and the incumbents are of the view that adequate connectivity has been provided to Jio for a trial phase.
Mathews insists incumbent telecom service providers are happy to cooperate with Jio as more inter-connectivity is good for business. That was his response to Ambani’s appeal.
As Reliance Jio threatens to shake up the data services market, Mathews agrees that data is clearly the way forward but insists that does not mean Reliance Jio is any better positioned than its competitors on that front.