TRAI says roaming charges waiver will have least impact on operators’ revenue

The Telecom Regulatory Authority of India has said that mobile operators’ revenues will get impacted only by about 1.5 per cent if roaming charges are waived across the country.

According to the estimates made by the regulator, mobile companies stand to lose between Rs 1,806 crore and Rs 2,216 crore if roaming charges are waived.

It has, however, said that the impact on revenue should be looked at in the context of the socio-economic benefits that such a regime would bring to the country.

“By facilitating communication between citizens, the regime would play its role in fostering nationwide mobility of individuals and social, cultural and educational integration,” TRAI said in a consultation paper floated on the subject.

Opposed by telcos

While the regulator is yet to finalise its recommendations, the views expressed in the paper assumes significance in the light of opposition by mobile companies to waive roaming charges.

Apart from Reliance Communications, all the other operators have opposed the proposed policy on grounds that the move will have a huge impact on their revenues. The operators have threatened that they will be forced to either stop offering roaming services or increase local call charges to compensate for the revenue loss.

According to the operators, they earn over 8 per cent of their revenues from roaming services which would get wiped out of the policy to abolish roaming charges is introduced. But the Government has already announced the policy under the new National Telecom Policy and committed to waive the roaming fees this year.

Once roaming charges are waived, mobile users can get incoming calls free of charge and make outgoing calls at local rates while travelling anywhere in the country. At present, operators charge Re 1 per minute for incoming calls and Rs 1.50 per minute for outgoing calls while roaming. An SMS is also priced at Rs 1.50 per message.

“We suggest that the roaming tariff under the prevalent hyper-competitive market conditions should continue to be kept under the time-tested policy of forbearance,” Airtel said in its response to the TRAI paper.

Mobile players said that they would be forced to increase overall tariffs to make up for the loss in revenue as a result of the Government policy.

High-end users

They said that roaming services are used mostly by high-end users and, hence, a waiver in charges would impact the general consumers.

“Any attempt to regulate the roaming tariffs for the benefit of small fraction of users is likely to compel operators to revise their general tariffs and that will invariably affect the masses,” said Idea Cellular.

TRAI, on the other hand, reckons that the operators will be able to recoup the revenue lost through increase in volumes.

> thomas.thomas@thehindu.co.in

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