May 27, 2018, 11:17 pm IST
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Jio accused of predatory pricing

Jio accused of predatory pricing

 Jun 18, 2017

Telecom operators Airtel, Vodafone and Idea Cellular are unhappy with Reliance Jio’s “predatory free pricing strategy”. This they say is to “injure competition”. United against rival Jio, the three operators met the Inter Ministerial Group (IMG) individually. They said the current call connect charges of 14 paise per minute is below cost and needs to be corrected.

The launching of Reliance Jio in which parent Reliance Industries Limited (RIL) has invested a whopping 25 billion USD has effected a consolidation in India’s telecom industry. Jio has been accused of adopting a strategic business tactic of attempting to eliminate its competitors and gain higher market share. Once it captures the market, it can increase the costs as competition will be minimal, it is alleged.

“Only solution is to have floor prices for Voice, SMS, and Data Services…”Idea said giving Sri Lanka and Bangladesh as examples of countries that have imposed floor prices for mobility services. Besides, the big operators have cumulatively lost Rs 8200 crore of revenue in the second half of the last fiscal as compared to the first half.

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