Telecom Regulatory Authority of India (TRAI) has slashed ceiling tariffs for national roaming. From May 1, mobile phone calls will cost 23 per cent less, while sending messages will cost up to 75 per cent cheaper while on roaming.
TRAI has put a ceiling of 80 paisa per minute for outgoing calls from Rs 1 a minute earlier. STD calls cost has been reduced from Rs 1.5 per minute earlier to Rs 1.15 a minute. Incoming calls on roaming have been given a fixed ceiling of 45 paise per minute from the earlier 75 paise. Local texts will cost 25 paise compared to Rs 1 before; while STD texts will cost 38 paise from Rs 1.50 earlier. Apart from TRAI has also mandated that by May 3 telcos will have to provide their subscribers with the ability to port or move to another network provider without having to change their mobile number.
“TRAI has reduced ceiling tariffs for national roaming calls and SMS and has mandated telecom service providers to offer a special roaming tariff plan. These changes will come into effect from May 1, 2015,” TRAI said in a statement on Thursday.
TRAI Secretary Sudhir Gupta said in the press release issued on Thursday, "All subscribers will benefit from the reduced ceilings; competitive pricing below the new ceiling levels is expected."
COAI has expressed happiness over the move. In a statement, Mr. Rajan S. Mathews , Director General of COAI, said, “TRAI has recognized there are long distance costs that need to be covered and hence the need for differential tariffs. However, the industry is disappointed that TRAI has not allowed for a longer time for market forces to play out. Given the extreme nature of competition in Indian markets and the low price points that already exist, a light touch regulatory approach that relied more on market forces would have been desirable. It is too early to compute the impact on industry revenues at present.”
The lower charges will benefit the consumer but will hurt profit margins of telcos who paid a lot of money for the spectrum auction earlier this year. Telcos bid nearly Rs.1.1 trillion in the spectrum auction that concluded on March 25.
“These ceiling tariffs are good for the consumer but will hurt the profitability of telcos given the high price they have had to pay for spectrum,” said Hemant Joshi, partner, Deloitte Haskins & Sells LLp.
TRAI had last revised the national roaming tariffs in 2013, while formulating the revised tariff regime for national roaming this year TRAI has stated that the new tariff regime will be reviewed again next year.