Airtel chief predicts rising mobile tariffs, if spectrum is charged

TRAI’s decision about one-time fee for additional spectrum consumed by operators has been making rounds for quite some time now. Older operators who have acquired the extra spectrum aren’t in favour of the one-time fee charge for the additional spectrum. Now, Sunil Mittal, Chairman of Bharti Airtel says that if operators will have to pay for the spectrum then mobile tariffs will see a rise. So, eventually Indian mobile phone users will be paying more.

Expect pricier bills (Image credit: Getty Images)

“We have been offering services with lower tariffs when we have not been charged for spectrum. Going ahead, if it (spectrum) will be charged, we will also have to charge the customer,” Sunil Mittal said.

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Reportedly, most of the mobile operators, which obviously includes Bharti Airtel, have already increased charges by 20 percent due to the increase in the cost of operation and also the stiff competition. Mittal further spoke of safeguarding the company’s interests. “We will favour affordable service which should be viable for industry… Who will gain if our business is shut down?… This has to be balanced,” he said. The government has proposed to delink allocation of airwaves from licences in the New Telecom Policy (NTP), which will be unveiled next month.

India’s telecom tariff is said to be the cheapest in the world, and he says its even lower than Africa. “(Tariffs in India) are still best in the world. Rates in Africa are 7 cents which is Rs3.5 per minute,” Mittal said.

The telecom commission has decided to charge extra for spectrum that exceeds 6.2MHz. Obviously, this will put some burden on older operators. TRAI had recommended the one-time fee, computed by experts. TRAI had stated that each megahertz of extra spectrum after crossing the 6.2 MHz limit would be charged a one-time Rs.4,571.87 crores (All India). Earlier this month, DoT had decided to impose one-time fee on a prospective basis.