Cell phone operators slash STD rates to Rs 2.99 per minute

agencyfaqs! News Bureau

NEW DELHI

Future competition from limited mobility players has united cellular operators. All for the benefit of the end consumer.

In an unprecedented move, the GSM mobile industry yesterday announced a cut in the national long distance tariffs from the current peak of Rs 9.00 per minute down to a flat rate of Rs 2.99 per minute, anytime, anywhere, for all mobile-to-mobile calls of 50 km distance and above. The unanimous decision came after a meeting of cellular operators including representatives of Bharti, Hutchison, Escotel and SpiceCorp.

The new tariff package came into effect from the midnight of Thursday. It will immediately benefit over 10 million cellular users and simplify the existing distance-linked tariff to a ‘one rate plan', indicating the "death of distance and time factor" for calls between any two cellular mobile subscribers, in any part of India.

Announcing the new tariff package on behalf of cellular operators, Telecommunication and IT Minister Pramod Mahajan told reporters in Delhi that this was the first instalment of the new rates and that the industry would announce more such concessions on a weekly basis to ‘kill their rivals in instalments'.

The new tariff structure is like this. Up to a distance of 50 km, cell-to-cell national long distance calls would continue to cost Rs 1.20. Beyond 50 km, irrespective of time and distance, subscribers would be charged Rs 2.99 flat. This tariff structure will not be applicable to cell phone to landline calls.

This is indeed good news for the average cell phone user. In any case, cellular phone tariffs in India are the lowest in the world. The industry was the first to trigger of massive reduction in domestic long distance tariffs exactly a year ago, from the then peak of Rs 24 per minute. With the current ‘one rate plan', the effective reduction in cell-to-cell national long distance tariffs over the last year is more than 88 per cent.

The current offer powered by Bharti Telesonic's IndiaOne is available to all cellular mobile subscribers without exception. The ‘one rate' plan makes life easier for those customers who otherwise wait till the middle of the night to call at off-peak rates.

GSM subscribers who have roaming facility (a service exclusive to GSM mobile customers) would benefit tremendously as a result of this dramatic reduction, because now the ‘roamer' will have to pay only Rs 2.99 per minute as the STD rate. This reduction will make 'roaming' extremely affordable to the masses of India.

The cellular industry representatives also reiterated during the course of the press conference that having provided the cheapest cellular service in the world and rapid build-out across the country, GSM operators expected fair and just regulatory treatment vis-à-vis WLL(M) operators.

The cellular industry's emphasis on fair play is understandable. The cellular industry has paid close to Rs 9,000 crore as entry fee to provide mobile telephony, while fixed line operators have been allowed free entry into mobility, thus enabling WLL(M) operators to provide lower tariffs. Further, only cellular subscribers are forced by regulation to pay two charges while calling a fixed line or a WLL (M) phone. WLL(M) subscribers, on the other hand, are required to pay a single charge. It is these and other such regulations that are preventing the cellular industry from being competitive vis-à-vis limited mobility services.

The cellular industry is confident that given its consistent record and commitment to reducing tariffs, existing and potential cellular customers will choose them over the limited mobility services - the legality of which, is still under question. © 2003 agencyfaqs!