The Telecom Regulatory Authority of India (TRAI) will not regulate the tariff air passengers pay for making calls and browsing the Internet while flying in Indian airspace, a top official said.
However, mobile phone operators, sector watchers and aviation experts said there was little business case for local carriers as it required dependence on intermediaries and the revenue would not be enough compared with the investments required as the travel time on domestic routes are usually short.
Multinational telcos are supposed to act as intermediaries between airlines and Indian telcos while offering in-flight connectivity (IFC) services, as per rules.
“Tariffs are under forbearance in entire telecom sector and it (in-flight connectivity) will not be an exception. We will not govern it, but will keep it under forbearance,” Trai Chairman RS Sharma told ET. He didn’t elaborate on what the pricing levels could be.
He added that the architecture for offering in-flight connectivity (IFC) services would be a business decision between Indian telcos and international telecom carriers with the latter acting as “intermediaries” between the aircraft company and a local telco.
“Telecom operators managing a local earth station will have to get arrangements with international service providers and not with airplane companies directly so that flights while entering into Indian aerospace will start getting signals,” the top official said.
Earlier this month, a high-level inter-ministerial Telecom Commission, headed by Telecom Secretary Aruna Sundararajan, approved the move to allow air travellers to access Internet over smartphones and make calls once the aircraft achieves a height of 3,000 metres.
The IFC initiative would broadly allow aircraft companies such as Airbus and Boeing to forge alliances with multinational telecom carriers to deploy equipment and enable them to enter into pacts with local broadband service providers.
Based on a custom tariff plan, the process would permit air passengers to connect onto an ‘on air network’ or inflight Wi-Fi service and receive one-time password (OTP) to activate ‘secured’ data services.
“There will be a Wi-Fi protocol which is being currently used in the sector and there will also be a traceability of user accessing the Internet services,” Sharma said.
VSAT (Very Small Aperture Terminal) CUG (Closed User Group) license holders that include Reliance Jio Infocomm, Bharti Airtel, Tata Services and Hughes Communications can operate IFC with satellite links, and alternatively, those with Unified License (UL) with National Long Distance (NLD) service authorisations can also offer similar services.
Indian telecom firms, however, were not enthused.
“It’s the owners of the aircraft that make the most money because pricing power resides with them, and they will market the service and make profit on it, so, it’s not much of a lucrative area for Indian carriers,” said Rajan Mathews, director general of Cellular Operators Association of India (COAI), which represents all service providers including Bharti Airtel, Vodafone India, Idea Cellular and Reliance Jio.
He added that the business would be very marginal at best, since the scope of offering the service would be limited to Indian air space.
The aggressive data tariffs, with voice effectively free, adopted by Indian carriers in the local market would also be a deciding factor in offering tariffs for voice and data on board airlines, Mathews added.
None of the four telcos responded to ET’s queries. DoT is working with aviation authorities to formalise the process for seeking IFC license. Officials said consumers would be able to get voice and data services during flights within three to four months. – Gadgets Now