An Indian Civilizational Perspective

Airtel, Vodafone, Idea, Tata are slashing talktime and freebies

For the prepaid telecom customers in India, changes have been introduced in the shape of reduced talktime and lesser freebies.  For others, tariff revision is not far off.  Why?  Because of two things:

  • Pressure on the revenue per minutes measure
  • Government charges being levied on the telecom companies

Chief executives of leading mobile phone companies had warned of an inevitable tariff revision as the current rates were not sustainable for the industry, which now faces payouts to the tune of thousands of crores in regulatory fees, as the government plans to impose a one-time spectrum charge on all existing mobile phone companies.

The total industry outgo for private GSM operators is expected to be around Rs 14,000 crore. A similar fee for CDMA operators has not been established yet as the airwaves sale for this technology platform was cancelled following the withdrawal of two potential bidders – Videocon and Tata Teleservices.

96% of the roughly 1 billion mobile customers in India use the prepaid mobile plans.  Some of the changes to improve the bottomline brought about by the telecom companies are:

Over the last 15-20 days, mobile phone companies have subtly tweaked plans offered by various categories of discount vouchers.

For instance, Bharti Airtel has reduced the validity to 60 days from 90 days of a discount voucher available in Delhi costing Rs 28 that allows subscribers to make national long-distance calls at Rs .012 per second.

In Maharashtra, Idea Cellular has increased the price of a discount voucher to Rs 97 from Rs 72 that allowed users to call at 1.2 paise per second for a period of 90 days. Vodafone in Kolkata has reduced the number of free minutes to 55 from 65 on a ‘minutes pack’ valid for five days costing Rs 22. Tata Teleservices has tweaked a similar ‘STD seconds pack’ costing Rs 196 in Karnataka where it has reduced the number of free seconds to 33,000 from 36,000 over a month.

The Telecom Regulatory Authority of India (TRAI) has allowed the telcos to come up with combo vouchers to improve the product bundling and have a more meaningful revenue opportunity.

The Telecom Regulatory Authority of India (TRAI) recently permitted access service providers (ASPs) to offer combo vouchers, as part of ‘The Telecom Consumer Protection (Fourth Amendment) Regulations, 2012’.
Earlier, ASPs were allowed to offer three categories of vouchers, namely, plan vouchers, top-ups, and special tariff vouchers (STVs). Of late, however, several service providers and the Cellular Operators Association of India (COAI) have been demanding that a fourth category of vouchers be included, i.e., combo vouchers. These combo vouchers would make up an additional category of vouchers under the TCPR, offering both, monetary value and tariff concessions through a single voucher.

In the same vein, the Telecom Regulatory Authority of India (TRAI) elaborates in its official notice that combo vouchers will sport a blue colour band, while top-up vouchers will sport a green colour one, making them easily distinguishable.

In its official notice, the TRAI shared that such vouchers offered more flexibility to the service providers to “offer innovative bundling of the products based on market segmentation”. The TRAI believes that users will have the convenience to purchasing additional monetary value as well as well as get benefit of special tariffs through a single transaction.

 

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