Telcos spar over roaming charges

It is yet another battle front that has opened up between traditional rivals in the mobile telephony space. On the day Vodafone cut the price of its 2G data services by almost 80 percent, Reliance Communications went hammer and tongs at the telecom regulator for not making domestic roaming absolutely free of cost.

And while the two may appear to be unrelated issues, there is more to this than what meets the eye. CNBC-TV18's Malvika Jain reports. The intent behind RCom seeking free roaming is not hard to gauge. Older and more established operators like Bharti Airtel, Idea or Vodafone stand to lose on revenues in 2G roaming as they have more profitable users in that segment and account for almost 70% percent of the domestic roaming market. But more than hurting rivals, the Anil Ambani firm believes that free roaming would actually grow business. RCom already offers free roaming in certain tariffs plans within its own network. Gurdeep Singh, CEO, Reliance Communications says, “We believe that in the coming few months, as it happens in any tariff reduction changes that you go through, you have an initial dip in the consumption and the revenue thereof. But we expect to benefit with the overall revenue and profitability growing through the increased roaming usage, as more and more consumers come into the roaming segment.” Be that as it may, the TRAI, headed by economist-bureaucrat Rahul Khullar has not agreed with this view. So, even as the concept of "one-india" in call rates and fully free roaming is unlikely any time soon, there is another tariff battle that has been initiated by Vodafone on Tuesday. The company has bought its 2G data tariffs almost on par with 3G data tariffs. As a result, based on certain tariff packages, one GB of 2G data will cost Rs 2000 versus Rs 10,000 currently. This step will force Vodafone’s rivals to respond and perhaps offer similar tariff options. The underlying theme though of telecom action in the last 24 hours is that mobile data rates are slowly coming down in India. But the biggest slide is yet to happen. Come early next year, 4G data prices from Reliance Jio could knock the wind out of everyone else.