Home BusinessMobile termination charges may be cut
Move could further bring down mobile tariffs.
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The government is considering a reduction in mobile termination charges by next year, a move that is expected to bring down call rates further.
India already has the lowest call rates across the world and the recent schemes announced by mobile operators on per second billing has taken this to as low as 1 paisa per second. Mobile termination charge is paid by a mobile operator to another on whose network the call ends.
“I have requested the operators, the termination charges can come down by 2010 and accordingly tariffs can be reduced,” communications and IT minister A Raja told reporters after a meeting with CEOs and other senior officials of telecom service providers. He said the local call charges can come down to as low as 10 paise a minute and STD rates to just 25 paise per minute.
CHEAPER CALLS?
* Mobile termination charge is paid by a mobile operator to another on whose network the call ends
* The move is expected to bring down call rates further
* India already has the lowest mobile rates across the world
* The local call charges could come down to as low as 10 paise a minute and STD rates to just 25 paise per minute
* DoT would have to refer the matter to Trai for its recommendations
* The move would help new mobile players like Unitech, Datacom and Loop Mobile
However, the Department of Telecommunications (DoT) would not be able to reduce the termination charges on its own. It would have to refer the matter to the Telecom Regulatory Authority of India (Trai) for its recommendations. Subsequently, Trai would float a consultation paper on the issue and give its recommendations.
Earlier this year, Trai had slashed local termination charges by 33 per cent to 20 paise per minute from 30 paise a minute.
The move would also help new mobile players such as Unitech, Datacom and Loop Mobile who have less number of subscribers on their network. New operators have been demanding a reduction in mobile termination charges. Some of the operators had suggested lowering of termination charges to 10 paise per minute. However, the existing players have been opposing any further reduction in the charges.
Raja also said he had asked telecom operators to utilise the Universal Service Obligation (USO) fund to enhance telecom infrastructure in rural areas. The service providers should also work towards increasing the penetration of broadband across the country, he added.
The government has about Rs 16,000 crore in the USO fund, which is used for subsidising rural operations. It has fixed a target of 10 million broadband subscribers in rural areas in the next two years. Raja would also meet telecom equipment manufacturers and internet service providers in the next two days.