The telecom regulator's attempt to bring in tariff reforms will lead to a rise in the number of mobile users in the country, say telecom analysts.
The Telecom regulatory Authority of India (TRAI) has issued a consultation paper on "Certain issues relating to telecom tariffs", proposing to revise the existing cap of 25 on the number of tariff plans and bring in more transparency in services.
It has observed that customers often get confused with a plethora of tariff plans and glitzy advertisements offered by the operators.
The chief editor of CyberMedia's ICT group and telecom analyst, Prashanto Roy, said the cap in the tariffs will not only be consumer-friendly but will also prove to be beneficial for the operators.
The tariffs offers proposed to be dropped will basically consist of the least used tariff plans which hardly generates any revenue to the operators.
"The move will lead to clarity thus benefitting both the subscribers as well as the operators," said Roy.
According to another analyst, the transparency in the telecom services offered will cause a major development in the sector as many fail to provide clear information to customers resulting in a lack of transparency.
"TRAI's move in bringing transparency is welcome since customers often find it difficult to take informed decisions due the large number of confusing tariff plans" said Mahesh Uppal, director of consulting firm ComFirst India Pvt Ltd.
Without fixing tariffs, TRAI can mandate common formats for tariffs and billing. This can reduce the incentive for operators to have excessive number of plans as well as misleading advertisements, he added.
However, the secretary general of an industry lobby for cellular phone firms denied that there was any fault in the way the operators advertise the tariff plans, adding that there is no need for cap in the tariff plans.
"Every advertisement is absolutely transparent and it does not require any improvement," says S.C. Khanna, general secretary, Association of Unified Telecom Service Providers of India (AUSPI).
However, he added: "The TRAI has come up with a move and we are ready to reply and debate."
According to a recent report of Organisation for Economic Co-operation and Development, when consumers have too little information, poor quality information, or mis-information, they may end up misled and confused by the choices on offer.
TRAI's proposal is at the behest of consumers and consumers groups who say that lack of effective transparency has been creating confusion in the minds of subscribers.
They say a multiplicity of packages makes it impossible for an average consumer to make rational choices based on his or her individual needs. Tariff choices are mostly made on the advice of telecom companies themselves.
Equally, making choices across operators is difficult in the absence of a common platform.