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BUSINESS,
TELECOM
The
Death Of Distance
It
is likely, therefore, that by early next year, as you proceed to call
a Delhi number from elsewhere in the country, the familiar code 011-symbol
of a decades-old government monopoly-will have variants giving a choice
of NLD provider. As NLD aspirants foresee, aggressive pricing will begin
with "free offers"-like you can, for instance, have two minutes
free talk after 10 minutes of paid call. A Reliance Telecom strategist
says that the private NLD operators will offer a "quality dividend"
by ensuring high rates of call completion. Most players are going by conventional
analysis that tariff for the very long-distance (more than 1,000-km) calls
cannot fall below Rs 10 per minute. Their calculations, however, may be
upset by a price warrior like Sivasankaran who says, "My motto is
to unite India with a single telecom price of Rs 1.40 for three minutes,
anytime, from anywhere to anywhere in the country." If Sivasankaran
keeps his word, there will be many red faces all around. The worst hit
will be DOT.
Before Communications
Minister Ram Vilas Paswan announced the NLD guidelines, the thorniest
issue was whether the long-distance operators could pick up "intra-circle"-within
a telecom circle, which roughly is the same as a state-traffic along with
the inter-circle calls. Paswan was reluctant to allow it, fearing that
it would ruin DOT's intra-circle business. He buckled under pressure from
a committee led by Brajesh Mishra, principal secretary to the prime minister.
Following the present guideline, the NLD licencee can pick up intra-circle
traffic "with mutual arrangement with the fixed service provider
(FSP)". As of now, DOT is the only FSP, or almost so, private operators
having a token presence in six of the 21 telecom circles. However, TRAI
will give its recommendations on basic service this month which may allow
entry-for-all in line with the NLD policy. If that happens, the NLD operators
will enter the FSP market too and roll out networks within the circles,
thus collecting calls from outside the trunk routes and placing them on
their long-distance lines. The access charge in that case will be no more
than a book transfer. Today DOT charges an exorbitant access fee of 48
paise on a local call charge of Rs 1.20 placed to a private FSP.
India is
thus on the threshold of a real telecom revolution, with private networking
poised to extend to the tehsil level and tariff rates favouring the user.
The industry expects to jump-start on technology, and the expensive circuit
switches now in use will give way to "packet switching", based
on the Internet protocol and costing about a fifth of circuit-switch per
line. Says Chandrasekhar of BPL: "New technology will charge the
user not on distance but on volume of data, be it a call or a document
file. It spells the death of distance."
Will it
augur the death of DOT too? Probably not if the behemoth, with its five
lakh employees, slated to be corporatised this year, learns how to breathe
in a competitive environment. Its competitors will pay it 10 per cent
anyway, guaranteeing it the comfort of an absentee landlord.
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