BSNL Badly Impacted by Reliance Jio’s Predatory Pricing; Salaries Delayed

Saturday, 16 January 2021


BSNL Badly Impacted by Reliance Jio’s Predatory Pricing; Salaries Delayed

Saumya Mishra | March 16, 2019 16:39 hrs

GUWAHATI: The state-owned telecom company Bharat Sanchar Nigam Limited (BSNL) has been undergoing a crisis of non-payment of salaries; BSNL employees from Assam have also faced the brunt of the same.

The telecom company has close to 4,000 employees across Assam. On the other hand, there are around 2,000 officials and workers of BSNL in Guwahati alone. Further, the company has close to 1.68 lakh employees in India.
The officials of BSNL Assam circle informed G Plus that this was a momentary delay in the payment of salaries of employees for the month of February since the funds were not yet released by the corporate office in Delhi. 

However, authorities mentioned that they received the funds from the corporate office on Friday March 15, and they will be processing the salaries soon.  
BSNL is experiencing a cash deficit as it is facing tough competition in the market from other private telecom operators, especially Reliance Jio. 
“The salary of employees was delayed by 15 days this month as the corporate office had not released the money on time due to the issue of fund crunch,” informed an official of the BSNL Guwahati office on the condition of anonymity.
He blamed it on the “predatory pricing” of Reliance Jio which has dominated the telecom market in the recent past as they are resorting to a “monopolistic practise.” 

“Cash flow is getting affected because Reliance Jio is unnecessarily setting the prices which are below their cost. This predatory pricing of Jio is affecting the entire telecom industry and not just BSNL,” mentioned the source. 

He further added that the company has kept their pricing like this in order to kill the competition. “This is not even competitive pricing; this is predatory pricing which they are using to kill the competition,” said the official.

Sources said that other major telecom companies are facing a worse time with respect to their finances since they are dependent heavily on the loans.  

If employees are to be believed, BSNL had not seen such a financial crisis since the past several years in the company’s history. 
Elaborating on the reasons behind the delay of fund release, another employee at BSNL Guwahati, Giriraj Roy, informed that the company had to pay back a few bank loans which were pending from earlier and this led to the shortage of funds.        
“We are hoping that the delay doesn’t happen from the next month onwards,” Roy told G Plus. 
He further added that the company is usually in a good position to pay salary as they earn revenue of Rs 2,700 cores while the expenditure on employees’ salary is around Rs 860 crores all over India which is easily payable without any deficit. 

Other demands of BSNL employees

The BSNL employees had recently called for a strike and protested for their long-pending demands in February. It was a country-wide agitation demanding allotment of 4G spectrum to BSNL. Further, they had informed that they had not received the third pay revision. The de-linking of pension provision from the pay revision was another cause of the agitation.
The three-day strike had been called by All Unions and Associations of BSNL (AUAB). However, BSNL authorities said that its services in the northeast had remained unaffected amid the three-day nationwide strike.

Along with the strike call, AUAB had also put forward an eight-point charter of demands. Allocation of 4G spectrum to BSNL was the primary one in the demand charter. Though the private operators were allotted 4G spectrum in October 2016 itself, BSNL is still waiting for the 4G spectrum. The absence of 4G services reduces the competency, and it may eventually lead to the dismantling of BSNL.

BSNL’s declining popularity in Guwahati 

Bharat Sanchar Nigam Limited (BSNL) is facing a decline in its popularity in Guwahati as its number of users in Guwahati has reduced drastically in the last five years. The users have shifted to other mobile, landline as well as internet service providers.
An RTI (Right to Information) request filed in this connection revealed a drop of more than 14,600 BSNL landline users while more than 5,500 internet users have switched their service providers in the last five years in Guwahati.

There were a total of 53,536 BSNL landline users in Guwahati in 2013-14 whereas this number saw a steep decline to 38,872 in 2017-18. Further, there were 16,378 internet users in 2013-14 which became 10,865 in 2017-18. 

The data shows a continuous decline in the number of users opting for BSNL’s services over the years. Additionally, the rate of decline of the users has been almost consistent through the years. 

There was an initial decline of 3,000 customers from 2013-14 to 2014-15. The next year saw a decline of 5,000 users, then 1,000 users and finally 6,000 users left the services in 2016-17.
Further, the profits of the company also took a hit over the years. In the past five years, BSNL’s profits in the GSM section saw a steep decline from Rs 43.75 crores in 2013-14 to Rs 13.08 crores in 2017-18. 

On the other hand, the Wimax sector or the internet service of the company is the only segment which saw an increase in its profits during the past five years. Wimax services registered a profit of Rs 18.5 lakhs in 2013-14 which increased to Rs 26.8 lakhs in 2017-18. 
However, the profits of the CDMA service saw the most exponential decline from Rs 2.2 crores to Rs 29 lakhs.

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