Mobile tariffs to fall further

Mobile tariffs in the world’s cheapest telecom market are set to fall further by at least 20-25 per cent during the year, thanks to the increasing number of telecom operators and infrastructure overcapacity.

With local call rates at 33 paise and STD rates at 50 paise per minute, for most mobile operators, the country has the lowest telecom tariffs in the world.

According to industry analysts, the telecom industry is expecting the new licensees (including Loop Telecom, Datacom Solutions and Unitech Wireless) to commence operations in this year itself. Again, the expected expansion of existing players like Aircel Cellular, Idea Cellular, Tata Teleservices and Reliance Communications (RCom) is expected to have an impact on the mobile tariffs.

Moroever, the increase in the number of players will benefit the consumers in terms of newer enriched applications, choice and affordability. The on-ground traffic is increasing, but quality of traffic is not, clearly indicating that there is a need for more capacity.

According to Sridhar Rao, Chief Executive Officer, Vodafone Essar East, telecom tariffs in West Bengal is already among the lowest.

“There has been a 50 per cent drop in base local tariffs and 45 per cent drop in long distance rates. This is apart from bonus cards which have given an additional 20 per cent or so reduction from the base tariffs,” said Rao.

“Vodafone has tariffs as low as 20 paisa for local Vodafone to Vodafone in prepaid and 15 paisa in postpaid,” Rao added.

According to Vsevolod Rozanov, President and CEO, Shyam Sistema Teleservices, the newest entrant in the Bengal telecom circle, “Our standard local call rates are already 30 per cent less than the market norm, and on-net prices are 70 per cent less. This is before taking account of our million minutes on-net introductory offer, or 30 paisa lifetime local calling promotion, which has re-defined ‘value’, in our industry.”

“We will be coming out with innovative offers on our content services which will be launched on the ‘BREW’ platform this summer. Our immediate and near term ambition is to fully roll out our services on a pan India level by 2010. We are just making our offers more palatable and lucrative for value seekers to set an initial foothold,” Rozanov said.

Shyam Sistema has introduced ‘MCard’ as a ‘value offer’, for Rs 99 where customers can make local calls at 30 paisa for life. According to Shyam Sistema, this translates into a guaranteed lifetime saving of 70 per cent against the current market norm.

Among other plans, Shyam Sistema will soon be launching its first innovative value propositions for CRBT and downloads. These will be supported by the introduction of the ‘BREW’ platform, that is expected to enable a rich customer experience for these services.

“We have plans to foray into the data services market. We will make inroads with our data cards and other data related products like wireline and wireless broadband. We are planning to also launch the USB data modems and high speed data services this year. These are currently under trial,” said Rozanov.

Industry figures indicate that data services account for 8 per cent of a service provider’s revenues. However, many operators consider SMS revenue as a part of the data revenue.

A spokesperson of Aircel said, “Tariffs are now completely need-based. So we have a card for Rs 14, valid for three days. This otherwise sounds like a drop in tariff, which is true to some extent, but the focus for all service providers currently is actually need-based tariff plans.”