TRAI quizzes telcos on tariff hike

August 25th, 2011 - 5:56 pm ICT by IANS  

New Delhi, Aug 25 (IANS) The Telecom Regulatory Authority of India (TRAI) Thursday said it had sought clarification from telecom operators on their recent move to hike call rates.

“We will examine what are the reasons they hiked (tariff)… and whether there is any substance in what the companies are claiming,” TRAI chairman J.S. Sarma told reporters on the sidelines of an event here.

Bharti Airtel had last month announced a 20-25 percent hike in its tariffs in selected regions across the country. It was followed by Idea Cellular, Vodafone Essar and Reliance Communications.

According to Airtel, continuously declining margins, high auction prices for 3G and BWA (broadband wireless access), constrained spectrum and rural roll-out aspirations led them to hike their tariffs.

Airtel’s move gave a break to the cut-throat competition among telecom operators offering dirt cheap tariffs.

With the entry of new players and the ensuing tariff wars, the high priced bidding for 3G auctions, which saw top operators like Bharti Airtel and Reliance Communications coughing up Rs.12,295 crore and Rs.8,583 crore, respectively, had led to margins being hammered.

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