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Rediff.com  » Business » No scope for cutting mobile tariffs: COAI

No scope for cutting mobile tariffs: COAI

Source: PTI
March 09, 2009 19:50 IST
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The GSM telecom operators on Monday said that there was no scope for reducing call tariffs further and blamed the telecom regulator for slashing mobile termination charge below cost, but TRAI argued that its prescription was "cost based."

The termination charge is a charge paid by an operator to another on whose network the call ends, but the cost toward this is not much for big players since most calls originate and end in their home network.

"As per calculations based on international best practices, the three year forward looking mobile termination charge was calculated to be around 35 paise per minute," COAI Director General T V Ramachandran said in a statement.

TRAI has slashed the charge to 20 paise a minute with effect from April 1, 2009 from 30 paise now.

When contacted, TRAI chairman Nripendra Misra asserted that they have arrived at 20 paise-figure based on the cost parameters of all the operators.

"....do you think we have done the exercise over last 70 days to arrive at a figure which is not based on the cost," Misra told PTI.

He, however, refused to comment on COAI's allegation and also did not reply to a query whether the operators should pass on the benefit of lower mobile termination charge to subscribers.

In a statement, TRAI said that termination charge for all types of domestic calls such as fixed-to-fixed, fixed-to-mobile, mobile-to-fixed and mobile-to-mobile has been reduced to 20 paise per minute from 30 paise per minute.

"It was inexplicable how the value of 20 paise per minute had been determined," COAI said.

One of the new operators, who did not wish to be named, said that TRAI has succumbed to existing GSM players' pressure and fixed the termination charge at 20 paise, whereas it should have been lowered to just 10 paise or even less.

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