Saturday, 28 February 2015

Roaming may get cheaper as TRAI calls for 80% rate cut

NEW DELHI: Call and messaging charges while roaming may head south after the Telecom Regulatory Authority of India (Trai) on Friday proposed sharp 35% and 80% cuts, respectively, to the maximum rates that operators can charge for these services.

Trai has proposed to cut down maximum charges that can be imposed on outgoing local calls during roaming to 65 paise a minute, from the ceiling rate of Rs 1 per minute; to cut STD call rates during roaming to Rs 1 per minute, from a maximum Rs 1.5 per minute; for incoming calls, a maximum of 45 paise per minute, instead of 75 paise permitted at present; and a maximum of 25 paise per SMS sent by customers when they are roaming, compared to the prevailing ceiling tariff of Rs 1.50 per SMS.

"In view of the lack of competition witnessed in the present national roaming services market, the Authority is of the opinion that the best way forward is to prescribe costbased ceiling tariffs for voice calls while on national roaming," Trai said in a draft amendment to its Tariff Order of 1999. "Through the Amendment Order, the Authority intends to reduce the ceiling tariffs for national roaming services."

Trai has sought comments from stakeholders by March 13. It would notify the Amendment Order after considering, and incorporating if necessary, the views of the stakeholders.

"We are still assessing the impact of this (roaming) tariff cut. Even though roaming constitutes less than 8% of the total mobile industry revenue, the government seems to be just chipping all sources of revenue to the operators," Rajan Mathews, director general of the GSM industry body, COAI said. The industry generates some Rs 8,000 crore from roaming charges.

The sector regulator's latest proposal on roaming charges comes after a spate of consumer-oriented orders - slashing the interconnect usage charges (IUC) by 30%, scrapping similar charges for wireline operators, and making mobile number portability (MNP) applicable pan-India --passed by it in the last few days. IUC is the amount that mobile operators pay to each other for calls made from one network to another.

Vodafone India has already challenged in the Supreme Court the Trai order cutting the interconnect charges, which may shave of a bit of the operating income of big telcos.