The Telecom Regulatory Authority of India’s order on slashing roaming charges, which will come into effect on July 1, is good news to consumers. Telecom companies that feared the regulatory authority would go all the way and make nationwide roaming free are also breathing easy. In fact, major telecom companies reportedly saw their shares trading up on the BSE. The government order puts to rest the National Telecom Policy’s ‘one nation, one rate’ proposal, which was bitterly opposed by telecom companies with the exception of Reliance Communications.
The TRAI order reduces the ceiling level for national roaming tariffs by 29 per cent to Re. 1 per minute, while outgoing STD calls have been set at 38 per cent lower at Rs. 1.50 per minute. Cap on incoming call rate while roaming is down by 57 per cent.
Most telecom companies contacted by The Hindu refused to comment, while a few said that it was premature for comment.
Officials from the State-owned BSNL said that they were in the process of computing the new tariffs, and it was “too early to comment on the impact this could have on revenue”. The official said BSNL did not have official statistics on how much of its revenue came from roaming.
Telecom operators say about 10 per cent of their revenues come from roaming-related charges.
Rajan S. Mathews, director-general of the Cellular Operators’ Association of India, said that the TRAI order is “balanced”. “We are disappointed that TRAI has moved away from forbearance, but it has also given operators some flexibility to formulate their own plans,” he said.
This flexibility, at the least, allows operators to offset the losses it will make from the new rates. Asked about Reliance Communications’ claims that there were greater benefits to be made from making roaming free, he said the “claim beats logic”. “I suppose they do not have enough revenue riding on roaming,” he said.
Responding to The Hindu ’s queries, a spokesperson from Reliance Communications said the TRAI announcement is “token” and the company is “surprised and disappointed with only a reduction and some adjustments in national roaming charges”.
He added that the view that free roaming would adversely impact revenue is “biased and wrong”. “Roaming revenues are a small part of our revenues; reduction in roaming charges will have a positive impact on revenues as usage increases and volumes kick in. Free roaming will benefit customers and grow the business for all operators, as has been seen internationally.”