Financial Daily from THE HINDU group of publications
Wednesday, Jun 12, 2002
Info-Tech - Telecommunications
WLL tariff revision to take more time
NEW DELHI, June 11
THE Telecom Regulatory Authority of India (TRAI) has been caught in a bind regarding revision of tariffs for wireless in local loop (WLL) limited mobility services.
According to industry sources, the authority which was expected to come out with its revised tariff structure for the "poor man's mobile phone" on May 29 had to postpone it by 10 days. However, with no consensus emerging among the TRAI members on whether to abolish the floor rate of rentals and to allow the operators to offer alternative tariff structures, the revision has now been further delayed. It may now be possible only by the end of the month, sources said.
Currently, the tariff structure mandates that the basic operators offering these services have to charge a monthly rental of between Rs 450 and Rs 550 per month. Although the outgoing call charges as such have been pegged at Rs 1.20 for every three minutes with incoming calls free, the high rentals have made it more expensive than GSM-based mobile service.
The sources noted that the authority had just about begun undertaking a detailed cost-based study of these operations to revise the tariff structure.
In this context, it has collated the cost estimates of the networks of the basic operators who are deploying WLL services. However, the operators are upset because the format for the cost estimates have been structured in such a way that there is bound to be an upward bias.
As a result, the tariff structure that the TRAI will finalise will also have an upward bias to that extent. This would make the WLL services less attractive to the subscriber in terms of affordability, they have said.
In fact, the Department of Telecommunications (DoT) and the basic operators - both public and private - have been requesting the authority to do away with the floor rate. Although some members of the authority feel that a downward revision is possible, but a total abolition would be unfair to the cellular operators.
They argued that any such move would only blur the distinction between cellular mobile services and WLL services.
The DoT and basic operators have, however, been arguing that since WLL is a basic service, there should be no distinction between the terms offered for wireline and wireless operations.
The department, in particular, has noted that this cost difference would defeat the very purpose of allowing basic operators to deploy these services - for increasing tele-density. It has, therefore, sought that the lower ceiling be abolished and the operators given more flexibility.
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