Recently imposed floor prices on mobile users by the regulator can be removed within two years, while celco operators have themselves to blame for pushing the sector deep into the red, a senior executive said.

"None of us are saying that having an anti-market instrument like floor prices is a good thing on the long run, but it’s the plugging instrument to stop a dip in an industry," Hans Wijayasuriya, chief executive at Dialog Axiata said.

"It's a violent measure, it has to be done, it should have been done before and it is something which will give stability and certainty on the pricing domain so operators can concentrate on other dimensions of their business."

Earlier this month the Telecommunications Regulatory Agency (TRC) announced a floor price of a rupee for all voice calls on the same network and two rupees for voice calls between different networks.

Previously sold connections are immune to floor prices.

The TRC also said the previous sender network keeps all (SKA) would also be replaced by a mobile termination charge of 50 cents per minute and 15 cents for a short message service (SMS).

The new regime came into play on July 15, 2010. Floor prices make older connections more valuable and would be more sort after in future.

Wijayasuriya says floor prices are a quick fix and should be removed as soon as possible.

"A floor is something that can be engineered down over time," Wijayasuriya said.

"(Floor prices) to be completely removed anywhere between 12 to 24 months, I would think it's possible."

Wijayasuriya, a Cambridge University educated communications engineer by profession, had a 'fireside chat' at the 31st LBR-LBO CEO forum attended by several hundred senior corporate executives at the Ceylon Continental Hotel, Colombo.

The Sri Lankan celco market is shared between Dialog Axiata, Etisalat, Mobitel, Airtel Lanka and Hutch.

An intense price war started with Mobitel, a firm connected to state-run Sri Lanka Telecom giving a cut price tariff plan to state workers, ahead of Bharti Airtel's entry to the island.

Soon afterwards the celco sector played a tit-for-tat policy that soon turned into a bloodbath that ended with all operators posting record losses.

Last year Dialog Axiata made a loss of 12.2 billion rupees, the highest loss ever recorded at the Colombo Stock Exchange.

"I would first blame the operators, all of us, it's just academic to say who started it, who threw the first punch," Wijayasuriya said.

"But thereafter how you reacted to that can be subjected to scrutiny and some may have got it right and some may have not."

The competition however has made players leaner, but the industry was in turmoil and losses made it difficult for firms to invest in expansion and broadband services.