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Players split on differential tariffs

Thomas K. Thomas

New Delhi , Feb 14

IT could be the beginning of a new battle in the telecom sector. Divisions have arisen among operators on offering differential tariffs.

The TRAI had initiated a consultation process on the issue of differential tariff after some of the mobile operators started offering lower tariffs for its own subscribers.

For instance, Reliance Infocomm had launched a plan that offered tariffs as low as 40 paise a minute for all calls within its own network, with calls made to other private operators' networks charged higher. While most agree that differential tariffs should be allowed, they are divided over whether the companies be allowed to maintain lower tariffs within their own networks across the country or extend them to the subscribers of all other operators within a circle.

Smaller operators have told the TRAI that differential tariffs should be permitted only for local calls within the same circle, since large operators could use the national network to offer cheap STD rates.

"Differential tariff should be allowed only for intra-circle intra-service (fixed or mobile) calls. It should be the network confined within the telecom service area. The large integrated operators mainly get an edge in the case of inter-circle calls. In the case of intra-circle calls, it would be a competitive and balanced market environment," said HFCL Infotel Ltd. This view is also supported by the Cellular Operators Association of India.

However, operators like Tata Teleservices have mooted allowing differential tariff across the country as long as the operator uses the same technology.

MTNL has taken a middle path by suggesting that differential tariffs be allowed for intra-circle calls across all types of services, and not restricted to any technology.

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