There will always be some winners and some losers when the government tries to sort out the telecom mess. The group of ministers’ decision on Thursday, accepting the Telecom Regulatory Authority of India’s recommendation on a unified licensing regime in toto, shows that there were limited options before the government to create a level playing field. To understand the government’s stand, one has to set aside all the jargon-related issues and focus only on service providers and consumers. The crux of the matter is whether the current imbroglio between the cellular operators, basic telecom operators and wireless in local loop (WLL) players is in any way headed towards benefiting the consumers. It is here that corporates cannot lean on the age old tactic of blocking competition instead of fighting it. If a particular area has four licensees, there would be some licensees who would have a distinct first-mover advantage over the others. The second licensee will thus have to better what the first licensee offers and the third would have to better what the second offers, and so on. The going gets tougher and tougher and thus the viability of late entrants would always be under threat. After making investments, the telecom business is all about protecting margins, and in a very competitive market-place the margins could be low (not unremunerative however). But if an alternate player with alternative technology (in the form of WLL) not only offers what GSM players offer, but also betters the terms, the battle between the four players changes to a battle between the new player and the four licensees. After all, an aggressive WLL player would eat into their market share but from a consumer’s standpoint cellular players cannot fall back on legalities to protect their turf. Consumers should have freedom of choice and, in a competitive market, it would be a folly not to anticipate changing business conditions and advancements in alternative technology. Companies should be ready to offer the best that technology has to offer at the most competitive rates — a fact that both WLL and cellular players will have to abide by. Colluding to block technology and service providers under the garb of contractual conditions is tantamount to cheating the consumer. Having said that, it should be noted that Union Communications Minister Arun Shourie has assured cellular operators that he would look into their difficulties. In any case, the regulator, on Wednesday, while announcing the new interconnect usage charge regime, indicated that the “margins” of the operators would be protected. As corporate interests cannot take precedence over consumer interests, all operators should rise to the occasion and enable the government to meet the challenge of moving to a unified regime.
