Mobile Tariffs Will Be Reduced, Says Raja

[savramesh 37]

The Hindu

Saturday, May 30, 2009

NEW DELHI: Communications and Information Technology Minister A. Raja said on Friday that his priority would be to bring down mobile tariffs to 10 paise for local calls and 25 paise for national calls.

He said the 3G spectrum auction would be completed at the earliest.

“There is still great scope for reduction in mobile tariffs in India, which are the cheapest in the world. Entry of more mobile service providers and our pro-consumer policies will help bring down mobile tariffs to 10 paise for local calls and 25 paise for STD. This is high on my agenda.”

Currently, a subscriber pays 40 paise-Re.1 a minute for local calls and Re.1-Rs. 2 for STD calls.

Mr. Raja, who left for Chennai after the swearing-in ceremony to meet his party leader M. Karunanidhi, will take charge next week.

[P. K. Daga 3]

Hope, the ambitions are transfered into reality

[Greatest 55]

Let us all pray tht Mr Raja delivers as he promises..!!

[ravi_patent 28]

raja's track record doesnt inspire us.his actions were always creating further mess.his second tenure is the price we indians indians are paying for the democracy we enjoy.Atleast maran would have been better

[painkill3r 0]

price decrease in call rates in lifetime plans is needful

[CUPIDON 0]

^^^^^

Raja never does what he preaches, would be very difficult for him to bring down the costs to these levels

[lostjournal 7]

^^^^^

Raja never does what he preaches, would be very difficult for him to bring down the costs to these levels

We have already seen what a mess he made, as far as 3G is concerned. Still no signs of 3g - only promises.

May be India will see 3g when the world with switch to 4g.

[Greatest 55]

^^ I think it is the GSM players who are lobbying more with bureaucrats that is making Raja to keep delaying his promises..!!

[savramesh 37]

but there will be some immediate changes for sure, for the sake of government starting to rule.. atleast just to show off.. good things will happen when a government starts or ends [ie in the morning and evening of a government rule]..

Edited May 30, 2009 by savramesh

[situ1962 21]

yes,it will be great if it becomes a reality.the no of subscribers will increase greatly.let's wait and watch.

[FEVIN-RAJ 61]

^^^^^

Raja never does what he preaches, would be very difficult for him to bring down the costs to these levels

U said it ....

[Greatest 55]

^^ very true ramesh..

[me_saket 73]

^^^^^

Raja never does what he preaches, would be very difficult for him to bring down the costs to these levels

U said it ....

yes i agree, don't live in such fantacies.

Raja can't match STD rate to 0.25/min.

But i expect rates will go UPWARD. yes true, i said going higher.

Bcoz Telecom industry also need correction as Recession hits many job market in world.

How much loss can Telecos can sustained?

[savramesh 37]

^^^

but he will be aiming, by reducing charges, the usage will shoot up and finally increase in profit.. lets wait and see.

[ashoksoft 83]

The only way a reduction as high as this is possible would be introduction of a free spectrum 3G (akin to UK), where the teleco pays on the open licence once for unltd DATA TRANSFER. Allowing VoIP based communication and then terminating the interconnect agreement.

As of today all operators are paying a high price for interconnect (as high as 22ps in cases / minute). This impacts large players to an extent since a major chunk from the customers call charges is given to the receipient network. Terminate the rate is a lobby started by 3, a leading mobile operator in the UK - a similar revelution in india - can bring Raja's statements true.

Check this for more info : http://www.terminatetherate.org/Pages/Homepage.aspx

cheers

karki

[Greatest 55]

^^^ hmmm... interesting..!!

[ravi_patent 28]

the practical difficulties to raja's targets

http://www.business-standard.com/india/new...nt-note/359633/

[savramesh 37]

^^^

what if the same tariff introduced with a big rental like 1000 per month??

[SUDYEcaZ 67]

may be possible....

Remember tata 2000 plan

where every calls are free under a rental of Rs 2000,

n if 1 remember Raja had long back said that termination charge wil be done away with

So a STD call @ .25 is very much possible

[P. K. Daga 3]

Tata 2000 plan has caping of minutes.

[CUPIDON 0]

On Saturday, telecom companies said in one voice that prices cannot fall to such levels under the existing regulation.

The average cost of a minute-long call comes to around 50 paisa now, which includes termination charges of 20 paisa (money paid for a call to other networks). As a result, companies will loose 40 paisa if they have to turn Raja's dream into reality. A call to the same network will entail a loss of 20 paisa.

In the case of national long distance calls also, operators said they cannot offer tariffs which Raja claims are possible because apart from termination charges they also have to pay carriage fees which is around 65 paisa per minute.

"There is no way we can reduce tariffs to Raja's level as that would only mean losses," said a member of the Cellular Operators Association of India, a lobby group for GSM service operators

source : rediff

[ravi_patent 28]

@ramesh

this is what raja did to bsnl

"The minister cut the BSNL tender size, then he wanted price reductions after the bids were in and delayed the process by months, then he floated another tender"

even after all of this if do you believe in statements made by raja..

[ravi_patent 28]

and in case if anybody is still hopefull of raja's ability ,here is an excellent analysis about his deeds

http://www.business-standard.com/india/new...-baraat/359659/

Even Prime Minister Manmohan Singh’s well-wishers are convinced that his Achilles’ heel will be the DMK and its ministers like Raja — most of the allegations of favouritism in the UPA’s last tenure pertained to Raja’s ministry. Given the PM’s powerlessness, he caved in quickly after his initial refusal to give telecom to Raja, most are convinced Raja-II will bring more shame to the government. Here’s a prediction: after a few months, the same industry leaders who went to court against Raja-I will be singing his praises, talking of how pragmatic he is, how visionary, and so on.

This will have less to do with the minister’s style of functioning than it does with the chips he holds. Raja-I gave away scarce spectrum to a handful of favoured firms at a fraction of the market price instead of auctioning this to the highest bidder — this lost the government about $10bn, but caused a lot more damage. He gave the spectrum-cum-licences to firms who, by and large, didn’t have a hope in hell of being able to utilise it since they didn’t have the couple of billion dollars required for a half-decent network and, in any case, they couldn’t possibly compete with the huge scale advantages that companies like Bharti Airtel have. So while the favoured few can’t utilise their spectrum, firms like Bharti Airtel and Vodafone are starved of spectrum.

Logically, firms like Bharti/Vodafone should have bought out the favoured few and got their spectrum for a huge premium. But in order to prove he’d given out the licences only to be able to get more competition in, Raja put in place M&A norms which prevented a sale for at least three years. Raja-II will now change the M&A norms. This will allow Bharti/Vodafone to buy, for the sake of argument, Swan/Loop Telecom — Bharti/Vodafone will get their spectrum, Swan/Loop their return on investment, and everyone will be happy. Bharti/Vodafone would have had to pay money anyway, the only difference is that instead of paying the money to the government in an auction, they will pay it to Swan/Loop. (And who cares about the exchequer — even the BJP which has been so obsessed with corruption right from the time of Bofors, didn’t think this was worth getting agitated about.)

How Raja-II will do this is also interesting. He will probably make use of the wholly gratuitous line in a recent TDSAT judgement (the one that absolved Raja-I of the charges against him) saying the government needed to rework the M&A norms keeping in mind the industry’s need for spectrum. Since the man who wrote this judgement, JS Sarma, has been appointed the head of the Telecom Regulatory Authority of India, Raja-II can safely make a reference asking for the TRAI’s views on the matter!

If Raja-II allows the 3G auction to happen before this, this will reduce some of Bharti/Vodafone’s desperation for Swan/Loop’s spectrum. This will then lower the price Bharti/Vodafone will have to pay to Swan/Loop; it will make the older GSM mobile phone firms sing Raja-II’s praise louder — both sets of firms will compete to grab the minister’s mind.Watch this space.

The other big action area is the new spectrum report prepared by Raja-I’s ministry while he was in charge. The report suggests that all future spectrum be auctioned, that existing firms like Bharti/Vodafone who’ve got ‘extra’ spectrum (beyond the 6.2MHz guaranteed in their licence) be asked to pay for it. Raja-II now has to decide whether to accept the report and, if he does, whether to implement all of its recommendations and, if so, by when. If he decides that the ‘extra’ spectrum is a fait accompli and needn’t be paid for, he’ll be praised by the older mobile phone players. If he decides his favoured few will get free additional spectrum from the 4.4 MHz they have to 6.2 MHz, and it is only after this that the auction principle will come into force, this will win him praise from them. That is, there’s a lot of opportunity for both lots of firms to praise Raja.

When there are 10 million new mobile phone subscriptions to be had each month, few are going to spend too much time criticising Raja — the reason why it happened to Raja-I was that he blocked the older players’ ability to get spectrum. Live and let live.

Raja ki aayegi baraat/Rangeeli hogi raat/Magan mein naachoongee — and unlike Nargis in Aah, no one’s going to be crying. Or maybe the exchequer will shed a tear or two. Maybe.

[shashank 8]

I don't understand why you people are giving so much importance to Raja's Statements!

He became a minister...so he has to say some thing to the media....so he said these unrealistic charges....Thats it. It doesn't matter whether it is feasible or not...

The only thing i want from him is to Auction the 3G spectrum faster...hopefully before other countries get 33G....

He is an unqualified person for this post.

[savramesh 37]

@ramesh

even after all of this if do you believe in statements made by raja..

if it is reduced, many customers will be benefited. anyway i am not going to get benefited as my usage is very very less. only reduction in bsnl broadband charges will be helpful for me as my usage is more..

Edited June 1, 2009 by savramesh