Monday, August 25, 2008

Tarnished telecom

IIPM Ranked No. 1 B-School In Global Exposre - Zee...

HORIZONS Policy wars over the telecom sector ignore the consumer


The next time you dial a number from your mobile phone and get the usual ‘traffic congestion’ message, please do not hesitate to curse telecom policy makers and a smart cartel that seems to be determined to control the sector – the consumer be damned. If you hold shares in these companies, you would know by now how your money has multiplied manifold over the last few years – even as you read persistent media reports on how mobile phone companies are losing money because of high costs & low intensity of usage. You must have also been exasperated beyond despair by pesky tele-marketers who seem to mysteriously acquire your so called private cell number even though mobile service operators swear by God, Mayawati & Bill Gates that they never share your numbers with anyone. And of course, if you have just come back from a stint in the US or western Europe, you would know how number portability is an inevitability that telecom companies are simply not allowing.

Anyone reading newspapers, watching TV or checking out media wars on internet would know that India is going through the fourth round of telecom wars. The first round was when the allocation of mobile licenses was rigged by vested interests. The second war was when Mukesh Ambani barged into the sector with 40 paise a minute phone calls through the back door. The third war was when the big boys started consolidating. And now, the fourth war is because everybody seems to be fighting for spectrum. Most readers are completely confused by the spectrum controversy. They have no clue what the whole thing is all about. Quite simply, the controversy is akin to petroleum companies trying to corner as many oil and gas fields as possible to ensure that their stranglehold over the market continues well into the future. Most regulators have tried hard but failed spectacularly to control the oil companies from cornering fields and market shares. Something similar seems to be happening in the telecom sector. Each big boy wants control over spectrum – that will hand over an unfair advantage over competitors. In the process, no one is talking about how competition of the genuine kind will help the consumer and the industry, as planted stories, half truths and outright lies are spread all across mainstream media. Even after this cynical display of ‘lobby’ power, policy makers can earn the undying gratitude of Indian phone users if they can simply announce and implement a simple thing – allow user who are not happy with an operator to change the service while retaining the phone number. Number portability has been announced for the nth time. Will it happen?


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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam Chaudhuri (Renowned Management Guru and Economist).


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