pay per second

Couple of days back TRAI chairman Mr. J S Sharma came up with a proposal to propel telecom operators towards a new tariff system based on per second usage. In India, telecom operators presently follow the pulse system wherein consumers are charged for a full minute of airtime even if the call is shorter. The per second tariff system was introduced by TATA DOCOMO when it hit the headlines few months back. Now, if this new tariff system is good or bad, the answer is obvious – good for the consumers, bad for the operators.

CEO & Joint MD of Bharti Airtel, Manoj Kohli explains his concern towards this new pricing policy by saying,

TRAI has been following a policy of forbearance so this development comes as a surprise. Natural competitive play in the market has been instrumental in creating affordability in the market in the past and will continue to do so; we are awaiting the launch of TRAI’s consultation in this matter.

Similarly, Samaresh Parida, director (strategy), Vodafone Essar who was equally surprised by this proposal says,

Today the consumer has plenty of choices as you can see in the market place. We believe that free market forces ultimately drive these choices. However, we would be happy to participate in any consultative process with the regulator which is in the interest of long-term and sustained customer benefit.

The Indian telecom market is one of the most competitive markets in the world with mobile tariffs being amongst the lowest in the world. The market has evolved well in the past 10 years and with several other new entrants in the GSM market also expected to launch services with competitive packages will likely put pressure on existing players.