Chirag 5 Report post Posted April 21, 2005 TRAI slashes bandwidth prices April 21, 2005 14:31 IST Last Updated: April 21, 2005 14:52 IST Rediff.com Close on the heels of reducing the tariff for international bandwidth, the Telecom Regulatory Authority of India on Thursday slashed tariff for domestic bandwidth (domestic leased circuit) between 3 to 70 per cent, a move which would boost broadband penetration in the country. The telecom regulator has reduced ceiling tariff for 64 kbps, 128 kbps, 256 kbps by 54 per cent to Rs 0.44 lakh, Rs 0.79 lakh and Rs 1.36 lakh compared to the existing market rate of Rs 0.96 lakh, Rs 1.72 lakh and Rs 2.97 lakh respectively, TRAI said in a release. The revised ceiling tariff for E1 (speed of 2 mbps) has been cut 3 per cent to Rs 8.50 lakh from the market rate of Rs 8.80 lakh. Tariff for DS-3 (45 mbps) has been reduced 67 per cent at Rs 62 lakh compared to the existing market rate of Rs 185 lakh while for STM-1 (155 mbps) category, the tariff has been cut 70 per cent at Rs 165 lakh from the existing market rate of Rs 554 lakh, it said. The ceiling tariff prescribed by the order will take effect from May 1, 2005. TRAI will review the situation with regard to developments in the DLC segment after a year. Domestic leased circuit is the medium of carriage of data and voice services within the country. The service is provided by basic service operators, unified access service licensees, national long distance operators and infrastructure service providers category II. The key users of the service in the country are Internet Service Providers, IT and IT-enabled Service Enterprises like BPO units and telecom service providers. The tariffs fixed are in the nature of ceiling tariffs and operators are at liberty to offer rates that are lower than the ceiling fixed by TRAI. This may lead to reduction in broadband prices by service providers. While the telecom regulator has cut domestic bandwidth prices, VSNL had earlier challenged its order to reduce international bandwidth prices in telecom tribunal TDSAT. TRAI said the competition was not fully effective in the provision of DLCs despite more players in the market. Further, rapid technological advances have sharply reduced the unit cost of long haul bandwidth but the reduction witnessed in the leased line tariffs is not commensurate with reduction witnessed in the cost of providing the services. The reduction in the tariff for leased circuits seen in the market was largely restricted to selective routes and in selective capacities, it said, adding a competitively priced DLC service was fundamental to increase broadband penetration in the country. Share this post Link to post Share on other sites
deepu 0 Report post Posted April 21, 2005 When is this rate cuts going to be passed on to customers!!! Share this post Link to post Share on other sites
tanveer 59 Report post Posted April 21, 2005 and how much? Share this post Link to post Share on other sites
linuxguy 0 Report post Posted April 21, 2005 I want unlimited datatransfer!!! No use of this cut if we are going to pay by volume! Share this post Link to post Share on other sites
Arun 795 Report post Posted April 21, 2005 The telecom regulator today slashed the leased-line tariff by 70 per cent. However, major operators like Bharat Sanchar Nigam, Videsh Sanchar Nigam, Reliance Infocomm and AirTel are silent about when they will pass on the benefit to end-customers. Domestic leased circuit (DLC) carries data and voice services within the country. DLC determines the bandwidth available to the operators , which is essential to provide higher quality voice and faster download of data for the end consumers. It is very important for the promotion of broadband-based services like streaming video and high-speed surfing. The service is provided by basic service operators/unified access service licensees (BSNL, AirTel, Reliance Infocomm), national long distance operators (VSNL, BSNL, AirTel, Reliance Infocomm) and infrastructure service providers-category II (Powergrid Corporation of India Ltd and Gail). The Telecom Regulatory Authority of India (Trai) has revised downwards the ceiling tariff for different capacities by 3 to 70 per cent and for higher capacities it is 70 per cent less than the existing market rate. (See chart) The key users of the service in India are internet service providers, information technology (IT) and IT-enabled service enterprises like business process outsourcing units, telecommunication service providers and corporate enterprises. The tariff ceiling will come into effect from May 1, 2005, and will be reviewed after 12 months. Trai directed that pro-rata corrections, wherever applicable, must be made to any advance payments that might have been made for leased circuits on the basis of prevailing tariffs by the customers. The regulator added that the tariffs fixed are in the nature of ceilings and operators are at liberty to offer lower rates. The ceiling tariff for domestic bandwidth (domestic leased circuit) was originally fixed in 1999. A senior Trai official said: “The competition was not fully effective in the provision of DLCs despite the increase in the number of players in the market. Rapid technological advances have sharply reduced the unit cost of bandwidth. However, the reduction witnessed in the leased line tariffs is not commensurate with that witnessed in the cost of providing the services. This prompted us to revise the tariff and a further cut is expected soon based on a consultation process with the stakeholders.” The official said: “A competitively priced DLC service is fundamental to achieving a higher rate of penetration of broadband in the country, which provides a basis for fundamentally transferring the socio-economic opportunities, particularly in rural India.” Suppliers of domestic bandwidth like BSNL, Bharti, Reliance Infocomm and VSNL could face pressure on margins. A BSNL official confirmed that the company’s profit would be reduced as a result, but refused to quantify the extent of reduction. The BSNL official added that the PSU might approach Trai for a review. An Infocomm source agreed that there would surely be a negative impact on companies offering domestic bandwidth. BSNL is the largest provider of domestic bandwidth followed by Bharti and Reliance. A Trai official confirmed that the cellular and fixed-line prices would also come down but only in the medium to long-term. The broadband and Internet prices would be the first to see reductions. Share this post Link to post Share on other sites
linuxguy 0 Report post Posted April 22, 2005 It's not enough! Instead of fixing "ceiling" prices for telcos Trai should concentrate on enforcing quality of service requirements and unlimited downloads!!! Share this post Link to post Share on other sites
andycool87 0 Report post Posted April 22, 2005 It seems that these cuts arent goin to affect us consumers at all and if they do also it will be by a marginal extent These cuts are meant basically to increase the penetration of broadband to smaller cities by increasing profitability of the broadband players also it is slated to felp the call centers and BPO's And also to increase the quality of service Apart from the intent the private players are cribbing anyways about the ceiling price system that trai has asked them to adopt as they say that they have had to cut rates anyways coz of mtnl bsnl and they feel that in the telecom industry the price cuts should be because of competition and not this ways Share this post Link to post Share on other sites
