Bharti Airtel Files Counter Complaint with CCI Against Reliance Jio
India’s largest telecom service provider Bharti Airtel Limited has filed a counter complaint against Reliance Jio Infocomm Ltd with Competition Commission of India (CCI), accusing it of “abusing dominant position” and of “predatory pricing” with an intention to kill competition.
In a complaint to the CCI, Airtel said Jio is a dominant player in the telecommunication industry as “It is a subsidiary of Reliance Industries Ltd, which is the largest enterprise in India in terms of size, revenues, assets, and value.” Jio has invested more than Rs.1.60 lakhs crore in telecom and spend Rs.47,000 crore towards spectrum alone. Airtel said that Jio has abused its predominant position by providing free service since the company has launched its Beta Testing in December 2015.
Reliance Jio added approximately 5 million users during its test phase itself and at the time of its launch date on September 5, till December 31, it has grossed more than 72.5 million customers. Airtel also added “The free service provided by Jio is predatory in nature, which, in accordance with Section 4 of the Competition Act, ex-facie constitutes abuse of dominant position”
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Airtel said in a letter, dated 2nd February, addressed to competition watchdog that Jio’s “predatory free pricing strategy” is to “injure competition” and “It is a strategic business tactic adopted to enhance market power with the objective of eliminating competition which it has succeeded to a large extent during the quarter Oct to Dec 2016 itself.” Airtel stated that no other telecom companies in India or overseas is offering services free of cost or any free unlimited voice calls and thus Jio creates a monopoly for itself in the market.
Airtel also said that the strategy of Reliance Jio India Limited is to gain a higher market share by providing its customer free unlimited voice call and minimize competition, including eliminating competition from small players. Once the company gets higher market shares, it would likely to increase the costs or even it can charge the voice calls, since the competition in the market will be lesser and the customers will be left with a lesser number of service providers to choose from.
Jio rejected Airtel’s contention saying that Airtel has not provided adequate points of interconnection to the new entrant and was levied a hefty fine against the telecom for doing so and now it is trying to divert the attention from its own violation of rules. Jio said in a statement that all the tariff plans of Jio have been found to be non-predatory by the regulators, so there is no question of offerings being predatory arise.
Jio also added that Airtel is acting against consumer interest by opposing “free voice” benefits. Jio has been able to provide free service to its customers due to its superiority in technology.