Reliance Jio Accuses Telecom Industry Body of Perpetrating Anti-Competition Practices
Mukesh Ambani’s Reliance Jio is miffed at the Cellular Operators Association of India for misguiding and misinforming the government and statutory bodies, the company said in a letter addressed to Rajan Mathews, director general of COAI. BloombergQuint has read the letter sent to COAI.
Jio has alleged in the letter that the “incumbent dominant operators are themselves willfully and deliberately in violation of the licence conditions by restricting interconnection and augmentation, MNP etc.” This allegation was countered by COAI Director General, Rajan Mathews in an interview to BloombergQuint. “Reliance Jio testing phase is a full-fledged commercial operation masquerading as a trial,” Mathew said. Jio has enough network capacity to undertake testing required for the trial phase and Jio’s test phase is also resulting in a loss of revenue for the government, as the free of charge services provided by Jio are leading to loss of licence fees and spectrum usage charges to the government, Mathews added.
COAI and Reliance Jio have been engaged in a war of words over the last few days.
Jio has alleged in the letter to COAI that the association is openly promoting cartelisation in the guise of promoting the cause of the industry. But Mathews said as an association they expect some ‘sharp elbows’ between members as there will always be competition within members when a new entrant is trying to gain market share. It is important to note that Reliance Jio is also a member of the COAI.
COAI and Jio have both been making representations to the government and putting forward their points of view.
Ahead of its launch, Reliance Jio is undertaking extended testing of its telecom network. Jio disclosed in statement recently that it is testing its network with nearly 2 million users. It said, the average monthly consumption per user is in excess of 26 gigabyte and is increasing rapidly. Average voice usage per month is over 355 minutes. The test program will be progressively upgraded into commercial operations in coming months, Reliance said in a statement in July while announcing its first quarter earnings for financial year 2016-17.
Incumbent telecom operators, led by telecom body COAI, have raised objections to the network testing with such a high subscriber base and at zero tariffs. COAI argues that this is leading to high churn rate of existing telecom services’ data customers, opting for the free 90 days of unlimited data download trial offered by Jio.