Need transparency in tariff plans of telecom service providers

Today if you look at the tariff plans displayed on the websites of telecom service providers, you will find it extremely difficult to make an informed choice.

Billmonitor, an accredited, UK-based, mobile tariff comparison service that regularly analyses consumers’ telecom bills, says 74% consumers in UK are on the wrong mobile contract and paying too much and getting too little value. There is no such statistical data in India, but this percentage might well be higher here, given the complexities of the present-day tariffs and the inadequacy of information to help consumers make the right choice.

The sun rises behind a mobile communications tower on a winter cold morning, in Gurugram. (Yogendra Kumar/HT PHOTO)

Today if you look at the tariff plans displayed on the websites of telecom service providers, you will find it extremely difficult to make an informed choice because first of all the information is not complete and second of all, it is not in a consumer-friendly and easy-to-understand format.

Today the ‘special tariff vouchers’ (STV), the ‘combo vouchers’ (CV) and the promotional offers in case of prepaid subscribers have assumed such importance that publication of any tariff plan without this information would be absolutely meaningless. In fact, because of the tariff options given in the form of STVs and CVs, the actual cost to a customer may vary from the tariff given in the plan voucher. So it is only fair that all telecom service providers publish not just the tariff plans, but also the information on the vouchers, in a uniform format that is easy to compare and understand.

But that’s not all. Given the large number of STVs and CVs offered by the service providers—over 500 of them— and the constant changes made in them, consumer’s right to informed choice requires more than just their publication in a simple, prescribed (by the regulator), format. Considering that about 92-95 per cent of consumers in India buy prepaid plans and these consumers come from varied educational and economic background, it becomes absolutely imperative that tariff plans be not just transparent, but intelligible to even those with elementary education, so that they buy what is in their best interest.

So the next step is to help consumers make sense of telecom tariff through the introduction of a tariff calculator tool that gives them unbiased and unprejudiced information on the tariff plans of service providers, compares the benefits of various offers and assists consumers in understanding the cost of enrolment and continued subscription of various plans.

The Commission for Communications Regulation, Ireland, for example, provides such facility on their website, so that consumers can make their decisions on the basis of clear, unambiguous, impartial information. Ofcom, the UK telecommunications regulator, on the other hand, has a scheme for accrediting agencies that provide price comparison services . The accreditation ensures the integrity of the data flow. Billmonitor is one such accredited agency that compares tariffs, analyses consumers’ telecom bills and helps consumers choose the right plan, thereby saving them considerable money .

I am really glad the Telecom Regulatory Authority of India has taken note of these issues in its detailed Consultation paper on “Transparency in Publishing of Tariff Offers”, and proposed various solutions to bring information pertaining to telecom tariffs in line with the international standards of transparency.

The consultation is very comprehensive and timely because today most people are buying telecom services with inadequate information and without really understanding the tariff or comparing the offers of various service providers for an informed choice. I really do hope that TRAI will not only usher in more transparency in telecom tariffs, but also follow the Ofcom or Ireland model for tariff calculator .

However, I must warn consumers that service providers have a very strong lobby and have already opposed the proposals, so consumers need to counter that by fully supporting this move by TRAI to empower telecom consumers and help them make the right choice.