International long distance (ILD) telephone service providers such as AT&T, BT, Cable & Wireless and Verizon will soon be allowed to sell calling cards to consumers for making international calls. This will increase competition and may lead to a fall in the prices of international calls.
“This may result in a price drop of up to 30 per cent,” said the head of long distance services at a national mobile operator. The price of a call to the US is Rs 5 per minute, depending on the tariff scheme. If standalone ILD operators aggressively market calling cards, this might fall to Rs 3.50 per minute, he said.
Currently, ILD operators are not allowed to sell their voice services directly to end consumers. As a result, a consumer does not have the choice of selecting an ILD operator.
For example, a consumer of Airtel’s mobile services does not have any choice for selecting an ILD operator. All ILD operators sell their own calling cards and the prices for international calls are lower by up to 50-60 per cent. But an Airtel calling card holder can use it only if he is a subscriber of Airtel’s mobile/landline phone.
“Once ILD operators are allowed to sell calling cards directly to customers, all the existing operators will sell their cards aggressively to attract subscribers of other operators,” the executive said.
A Department of Telecommunications (DoT) committee has recommended that existing ILD and national long distance (NLD) service licences should be amended so that operators are allowed to sell calling cards.
K. Sridhara, member (technology), Telecom Commission, has approved the report. It has now been sent for the approval of the commission. The proposal was initiated by the TRAI so that “true competition would set in and consumers should get benefit of innovative services and lower tariff”.
“Foreign ILD licence holders will find this market lucrative,” said B.K. Syngal, former CMD, VSNL (now, Tata Communications). “This will put pressure on prices of international call prices.” “We are looking forward to the government decision allowing ILD players to offer calling cards,” said the India head of an ILD operator, who declined to be named. “But it is difficult to estimate by how much prices will fall.”