DoT asks TRAI to review termination charges
DoT has asked the Telecom Regulatory Authority of India to review mobile call termination charges on priority basis.india Updated: Jun 23, 2008 20:28 IST
Department of Telecom has asked the Telecom Regulatory Authority of India to review mobile call termination charges on priority basis. A revision can bring about a reduction in call tariffs for users.
"Given the central aim of telecom policy to provide services at affordable rates, it is suggested that a review of the mobile termination charges, based on present and projected cost and traffic is undertaken by TRAI on a priority in a time bound manner," DoT said in a letter to TRAI.
Termination charge is one of the major components of tariff and is paid by an operator, from whose network call originates, to a service provider on whose network the call is terminated. Currently, the charges have been fixed at Rs 0.30 a minute.
The charges were fixed in 2003. While the cost of network and services have come down by more than 50 per cent since then, termination charges have remained unaffected as they are independent of market flux.
Some of the operators have pointed out that cost-based termination charges would be less than Rs 0.10 a minute. If implemented, the existing operators would have to forego a substantial portion of their revenues, while new cellular operators would find it easy to establish themselves.
“The reduction in termination charges will lead to reduction in pay-outs of the operators thus making the tariffs more viable and sustainable in the competitive environment," DoT said.
One of the operators said regulations like termination charges should be reviewed on annual basis, and delayed decision on this front has enabled existing operators to profit at the cost of consumers.