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Present tariffs not sustainable for sector’s long-term health, says Director General
The telecom sector is likely to experience three more quarters of losses, hurt by high levies and “unsustainable tariffs,” Cellular Operators Association of India (COAI) director general Rajan Mathews said. “Under the current scenario, I see at least another three-plus quarters of losses. I do not think the present tariffs are sustainable for long-term health of the industry…,” Mr. Mathews said. He said the high incidence of levies — licence fee and spectrum usage charges — compounded by upfront payment for radio waves have added to the operators’ woes. “Already, we have been through two quarters of losses [this fiscal]. So something dramatic has to happen in the next two quarters and we know that is not going to happen. Clearly, 2018-19 will be a tough year in terms of financial performance for the industry but the beginning of fiscal 2019-20 will see clarity [emerging],” he said.For the June quarter, Bharti Airtel had reported a loss of Rs. 940 crore from its India business, as it bled to retain market play, in the face of free voice calls and dirt cheap tariffs from Jio. Airtel, however, reported a Rs. 97 crore net profit on a consolidated basis in the April-June period after taking into account revenues from its Africa business. On July 30, announcing its last financial result before the merger with Vodafone India, Idea Cellular posted a total income of Rs. 263.5 crore for June quarter — helped by one-time gain from sale of mobile towers.
Source : https://www.thehindu.com/todays-paper/tp-business/telcos-may-report-losses-for-three-more-quarters-coai/article25222710.ece
