The Telegraph
Since 1st March, 1999
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Calls cheaper & on Net

New Delhi, Nov. 10: Long-distance domestic and international call rates are set to drop by 9 per cent. It has also become possible to make calls legitimately from a personal computer to a mobile or fixed phone.

Communications minister Dayanidhi Maran today announced a slew of initiatives to benefit telecom users. The decision to pave the way for a cut in national and international long-distance rates is a precursor to the introduction of one rate (IndiaOne) for calls made anywhere in India.

The Telecom Commission has slashed the annual licence fee long-distance operators pay to the government from 15 to 6 per cent of their annual gross revenue from January 1.

Maran is confident operators will pass this on to customers. “I expect call tariffs to drop by at least 9 per cent immediately. With removal of artificial barriers we hope to have a lot more competition in both segments and the major beneficiary will only be the consumer,” he said.

Fixed-line service providers have been allowed to offer Internet telephony using the voice over Internet protocol (Voip) technology. It is now legal to make a call from a PC to any fixed or mobile phone. While calls from one PC to another across the world was allowed in India in 2002, it was illegal to make a call from a PC to a fixed or mobile line.

The benefits are many. “The cost will come down and the quality of voice will go up. Only a couple of years ago, Voip was considered just hype, offering a quality of voice as bad or as good as ham radio. But it has come a long way,” said a senior executive at Cisco that specialises in Voip-based phones and networks.

The cost is lower in Voip calls since it uses a technology that takes the least congested routes to send voice in small packets that converge at the destination. Traditional networks take the call through a single route and wait if there is congestion.

When Maran said “artificial barriers” were being dismantled, he meant the cut in the entry fee charged to national long-distance operators from Rs 100 crore to Rs 2.5 crore and for international call operators from Rs 25 crore to Rs 2.5 crore.

This move is expected to open the way for more players, breaking the cartel of Videsh Sanchar Nigam Ltd, Bharti and Reliance. Entry will be easier also because a clause has been scrapped that made it incumbent upon an entity applying for a licence to have experience in telecom.

T.V. Ramachandran, the director-general of the Cellular Operators Association, said: “The lower entry fees would facilitate easy access to the long-distance segment, which in turn would lead to a plurality of players, and ensure a further fall in tariffs for STD/ISD calls.”

National long-distance operators have been freed from the obligation of setting up a point of presence in each district of a state. International call operators just need to set up one switch anywhere in the country.

These measures are also expected to lower call costs.

Sunil Mittal, head of Bharti, said: “We feel this will benefit the customers and is a step in the right direction for driving the growth of telecommunications.”


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