Calling Party Pays: Still a Long Way

Calling
Party Pays (CPP) has a long way to go before it is implemented.
MTNL has filed a number of petitions in the High Court and recently,
the Department of Telecom Services (DTS) and MTNL has challenged
the TRAI''s right to fix the revenue share between basic and
cellular operators in the CPP regime. The two feel that in the
CPP regime the revenue share should be arrived by mutual negotiations
between the basic and cellular service providers and not by
TRAI. They also feel that the role of TRAI comes only when there
is a dispute between the two.

CPP was
to be implemented by 1 November but it seems it will not be
implemented in its present form and changes will have to be
made. DoT and MTNL feel that CPP is in favour of cellular service
providers. In the CPP regime, a cellular user in the metro has
to pay a monthly rental of Rs 475 per month and an airtime charge
of Rs 4 per minute for all outgoing calls with all incoming
calls free. A cellular user in the circle has to pay Rs 500
per month and Rs 4.5 per minute. For termination of calls in
the basic service network the basic service providers have to
pay Rs 1.60 for the first 60 seconds and Rs 0.80 for each 60
seconds thereafter.

The Telecommunication
Tariff Order 1999 has already resulted in the loss of revenue
for DoT and MTNL and the two are not in a position to further
erode their revenues if CPP is implemented in the present form.

The tables
given along side depict how DoT and MTNL will incur losses if
CPP in the present form is implemented. We have taken three
different conditions-when the subscriber is in free call slab;
when the subscriber is in Rs 0.60 call slab; and when the subscriber
is in Rs 0.80 call slab.

In all the
three cases we see that the net loss to DoT is a minimum of
Rs 0.80 and it scales to a maximum of Rs 3.20. So any call made
from any wireline phone to a cellphone will result in a minimum
loss of Rs 0.80

It will
also choke the network of the basic service providers as calls
would be made from their network to celllular phone subscribers
without getting anything in return and in turn incurring a loss.
The clogging of network will result in loss of revenues from
calls which are not terminated as the network is busy. So, the
overall loss is huge.