TRAI seeks views on promotional offers, predatory pricing

New Delhi: Telecom regulator TRAI will review the rules of tariff assessment with regard to promotional offers and predatory pricing, issues that have triggered a public spat between Reliance Jio and incumbent operators.

These contentious issues would be debated as part of a consultation paper on ‘Regulatory Principles of Tariff Assessment’ issued by TRAI. “The consultation paper deals with emergent issues and challenges…related to regulatory principles of tariff assessment, for example, transparency, promotional offers, disclosures and non-discrimination, adherence to the principle of non-predatory pricing, meaning of predatory pricing, relevant market, assessment of dominant position,” a TRAI statement said.

TRAI said the consultation “aims to bring about greater clarity in interpretation of various regulatory principles set out in the Telecom Tariff Order in consonance with the best global practices”.

The industry and other stakeholders have been asked to submit written comments on these issues by March 17, 2017. The issues to be debated include new measures that need to be prescribed by the regulator to ensure transparency in the tariff offers made by telecom operators, and strengthening of definition relating to “non-discrimination”.

TRAI has sought views on which tariff offers should qualify as “promotional offers” and the need to limit the number of promotional offers that can be launched by an operator in a year one after another or concurrently.

It also seeks suggestions on definition and criteria for “dominance” in relevant telecom markets. “How to assess significant market power in each relevant market? What are the relevant factors which should be taken into consideration,” are questions that have been posed by TRAI in the latest consultation paper.

It will also review the methods and processes that should be applied by the regulator to assess predatory pricing by a service provider in a relevant market.

The review comes amid a standoff between newcomer Reliance Jio and incumbent operators such as Bharti Airtel, Vodafone and Idea Cellular on issues such as predatory pricing, market dominance and extension of promotional offers.

The telecom tribunal is currently hearing a plea by Bharti Airtel and Idea Cellular challenging the regulator’s decision to allow Reliance Jio to continue free promotional offer beyond the stipulated 90 days.