Telcos Face ₹10,000 Cr Gap as Network Spending Outpaces Revenue

The telecom trade group COAI has supported service providers' requests for higher mobile tariffs, pointing to the ongoing widening of the gap between their network expansion costs and their revenue.

The government has given telecom operators a lot of support through policies like right of way (RoW), but some authorities still charge astronomical fees for installing network components, SP Kochhar, Director General of the Cellular Operators Association of India (COAI), told PTI during his speech at the India Mobile Congress.

Earlier, the gap until 2024 for infrastructure development and revenue received from tariffs was around Rs 10,000 crore. Now it has started increasing even further. Our cost of rolling out networks should be reduced by a reduction in the price of spectrum, levies, etc.

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"The Centre has come out with a very good ROW policy. It is a different matter that many people have not yet fallen in line and are still charging extremely high," Kochhar said. He defended the cut down of data packs in entry-level tariff plans by select operators. Kochhar said that there is stiff competition among four telecom operators and there has been no special trend to show that consumers are migrating to low-cost data options.

"There is a need to find ways to make high network users pay more for the data. 70 per cent of the traffic which flows on our networks is by 4 to 5 LTGs (large traffic generators like YouTube, Netflix, Facebook etc). They pay zero. Nobody will blame OTT but they will blame the network. Our demand to the government is that they (LTGs should contribute to the development of networks," Kochhar said. He said that investment made by Indian telecom operators is for Indian consumers' benefit and not meant as a medium for profit of international players without bearing any cost.