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.