TRA issues new rules to curb telecom sector price wars

MUSCAT, AUG 15

Oman’s Telecommunications Regulatory Authority (TRA) has introduced new rules governing telecom pricing and promotions, aiming to protect consumers and ensure fair competition in the market.

The framework, released last month after consultations with Omantel, Ooredoo, Vodafone, Awaser and Majan Telecom, seeks to prevent “unsustainable competition” that could undermine revenues and investment in infrastructure.

Under the rules, the TRA will monitor market trends and intervene if prices for the same service fall by more than 10 per cent in six months or if average revenue per subscriber drops by over 5 per cent. Measures could include requiring prior approval from operators — particularly dominant players such as Omantel — before changing tariffs.

The Authority may also impose a three-month “cooling-off period” if market behaviour indicates a price war, temporarily blocking operators from introducing new offers.

Restrictions on promotions include a limit of four offers for the same service in six months, a maximum duration of 60 days per offer and eligibility only for “active subscribers” who have recently used voice, SMS or data services. No promotion can tie customers to contracts exceeding 12 months and only 5 per cent of an operator’s customers can be on discounted packages at any time.

The TRA will track the impact of such offers on competitors’ revenues and may intervene if losses are significant.

Industry responses have been mixed. Omantel has suggested introducing a minimum price per gigabyte to avoid what it described as a “race to the bottom”. Ooredoo and Vodafone have called for clear and consistent application of the rules, while Awaser argued restrictions should apply only to dominant operators.

A clause preventing promotional offers through tenders from being extended to individuals or small businesses drew concern from some operators, citing potential impact on SMEs. The TRA has since removed the term “commercial users” and confirmed that government agencies remain eligible.

The Authority said the framework will be reviewed regularly and adjusted as the market evolves and new technologies emerge.