TRAI order to benefit roamers

All rentals scrapped; cellular operators say annual loss will be Rs 900 cr

Despite strong opposition from telecom operators, mobile users will have to pay lower roaming tariffs starting February 15 with the Telecom Regulatory Authority of India ordering up to 56 per cent reduction in domestic mobile roaming charges.
TRAIhas also scrapped all forms of rental, surcharge and other additional charges being taken by the mobile operators at present for offering roaming services. The telecom regulator has also asked operators not to charge for incoming SMS while roaming.
While the move will benefit about 15 million mobile users who use roaming services, cellular operators, however, said that the TRAI move was "distressing" and suggested that operators may be forced to increase local tariffs to balance out the impact on their revenues.
Mr T.V. Ramachandran, Director-General, Cellular Operators Association of India (COAI) said the adverse financial impact on the industry was expected to be to the tune of Rs 800-900 crore annually. "The decline in roaming tariffs would most likely necessitate an increase in local call tariffs as roaming tariffs were hitherto being priced at a level which allowed the operators to offer affordable services to their consumers," said Mr Ramachandran.
Mr Manoj Kohli, President, Bharti Airtel, said that the decision was "unnecessary and unwarranted." Bharti's share price dropped by Rs 2.25 to touch Rs 686.90 on the BSE on Wednesday.
Reliance Communication and State-owned BSNL, however, said that there would be negligible impact on them since their tariffs were already at a lower level. R-Com's share price dropped by Rs 6.15 to close at Rs 434.
TRAI refuted claims of revenue loss by operators and said that reduction in tariffs would lead to substantial increase in usage for roaming service, resulting in overall revenue growth for the service providers. TRAI also said that the cost of providing services have been brought down significantly over the last five years. However, there has been no effect on national roaming tariffs.