Major Events That Changed The Face Of Indian Telecom Industry In 2019

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The telecom industry has seen a lot of ups and downs in the past, but 2019 has been the worst year for the sector. Both Airtel and Vodafone-Idea posted a loss of Rs. 74,000 crore in Q2 of this financial year due to the AGR issue. This was the highest ever quarterly loss in India's corporate history. And now incumbents (Airtel and Vodafone-Idea) are looking for a relief package from the government. So, we have enlisted every major event that occurred in the sector, making headlines in 2019.

Major Events That Changed The Face Of Indian Telecom Industry In 2019

 

1) Reliance Jio Becomes Second Largest Telecom Operator

In just three years of its operations, Mukesh Ambani-owned Reliance Jio bypassed Airtel and become the second-largest telecom operator in May 2019. However, there are high chances that Jio will surpass Vodafone-Idea soon. Besides, TRAI data reveals that Reliance Jio has pipped both Airtel and Vodafone- Idea to become the top revenue earner from its services in just three years of its operations.

2) BSNL And MTNL Merger

With an aim to revive BSNL and MTNL, the government decided to merge these debt-ridden PSUs. The government also announced an Rs. 69,000 crore revival package that includes raising sovereign bonds and a voluntary retirement scheme for employees.

Apart from that, the government reveals that it will provide 4G spectrum to BSNL, so that it can compete with private players such as Reliance Jio, Airtel, and Vodafone-Idea.

3) Big Blow To Operators: Supreme Court Backs DOT On AGR

The private players are buried under a debt of Rs. 3.9 lakh crore. On top of that, the Supreme Court has recently asked telecom operators to pay Rs. 92,000 crore to the Department of Telecom in three months which means in January 2021.

On the other hand, the government has given two years of moratorium on spectrum payment dues. This will provide a relief of Rs. 42,000 crore to operators. But, that is not enough as the sector is looking for more relief packages from the ministry. And Vodafone-Idea has already announced that it will shut its operations from the country if they don't get any relief from the government. At present, overall the industry has Rs. 7 lakh crore debt.

 

4) Airtel, Reliance Jio, And Vodafone-Idea Announce New Tariff Plans

All private players have announced new and revised tariff plans for their prepaid customers. This was the first time in three years that both Airtel and Vodafone-Idea have introduced new prepaid plans. This development comes after the Supreme Court approved DOT recommendations on the AGR issue.

Notably, Airtel and Vodafone-Idea have introduced unlimited plans, where the companies are offering free unlimited calling to all networks. On the other hand, Reliance Jio is charging 6 paise per minute to other networks. But the company is providing free calls to the same network.

5) TRAI Introduces New MNP Rules

The regulator TRAI has introduced new rules for Mobile Number Portability (MNP) to make it easy for all users. The new rules are already implemented, and they enable users to port their numbers in five days. These rules are not available in Jammu & Kashmir, Assam, and North East areas, where it may take up to 15 days. Furthermore, it will take three days if users want to port numbers in the same circle.

"TRAI has revised the Mobile Number Portability (MNP) process...In the revised MNP process, the Unique Porting Code (UPC) will be generated only when the subscriber is eligible to port-out his mobile number," TRAI said in a statement.

6) TRAI Defer Zero-IUC Regime For One More Year

To revive the ailing telecom sector, TRAI has recently announced that there will be interconnection usage charges till January 2021. This means there will no more be free calls, and callers have to pay 6 paise per minute for calls.

This move is expected to help telecom operators like Airtel and Vodafone-Idea. Apart from that, TRAI has come up new consultation paper where the regulator is planning to fix floor pricing. However, many analysts believe that this will further raise tariffs.

There is no doubt that the telecom industry is under huge debt. But the recent steps by the government seem that there are chances that 2020 will be a good year for the sector. However, the government is planning for a 5G spectrum auction in March- April 2020. In fact, DCC has given its permission for the auction.

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