The Telegraph
Since 1st March, 1999
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Booths dial distress over STD rate cuts

N. K. Gupta owns a public call office (PCO) on Dr Suresh Sarkar Street, near Moulali. Till four years ago, the small set-up — comprising two phones, battery and the call meters— was his sole survive-and-thrive revenue stream. It even generated enough cash flow for him to branch out into the courier business. But things have changed since then — the STD booth’s cash count has gone drastically downhill, and the courier curve is sustaining the call centre.

It’s time to dial D for distress at STD booths pushed into a ‘ring in the new or go dead’ corner by the telecom revolution of periodic long-distance rate slashes. With call costs dropping rapidly and the tele-density mark rising steadily — the city now has around 12.8 lakh fixed lines and five lakh cellphones — the glut of glosigns flashing ‘STD booth’ is on the fadeout fast-track.

Gupta, who is also chairman of the STD/ISD Pay Phone Booth-Owners’ Association in the city, blames the fast-emerging portrait of the PCO as an anachronism on the authorities, for their failure to devise “a viable business model” for those dependent on the STD call count.

“We get commission on the volume of business. So, corresponding to a price cut, volume declines and our commission also dips. Since August 1998, our commission amount has continuously gone down, while maintenance costs have been rising progressively,” complains Gupta.

While booth-owners have demanded a rise in commission from the existing 20 per cent to 40 per cent, most are trying to work out a new business model, by bundling more products and services. “On its own, a PCO has ceased to be a viable business proposition,” admits a booth-owner off Central Avenue, who is selling pre-paid connections of cellular operators, running a photocopy centre and a small snack corner.

Besides the constantly-dropping call rates — BSNL announced yet another slash of 47 per cent in domestic long-distance rates on fixed-line phones beyond 500 km on Monday, bringing it down to Rs 4.80 a minute from the existing Rs 9 —- business for the 14,000-odd booths has been hit hard by other factors, as well.

“The India Telephone Card is one of them, because it gives an individual the option to make a long-distance call from home. The price wars between cellular operators has also lured away customers, pushing down our sales volume by around 60 per cent,” adds K.L. Poddar, president of the STD/ISD Pay Phone Booth-Owners’ Association, who has two booths on Nimtala Ghat Street.

BSNL officials maintain that the reduction in long-distance rates is “inevitable”. R.K. Mishra, general manager, customer relation services and operation, says: “The rate cut is for the public and I am not quite sure about the fall in revenues, as the lower STD rates encourage people to talk longer from booths. PCOs can be set up with an initial security deposit of Rs 5,000 and a nominal investment. One can’t expect normal business-like returns.”

BSNL, however, is planning to throw PCOs a lifeline. “We are giving them permission to sell cellular connections, the India Telephone Card and providing them with glosign boards,” assures Mishra.

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