28 November, 2020

Still A Long Distance

STD could be as cheap as a local call. But only if the DoT is kept out of harm’s way.

Still A Long Distance
outlookindia.com
-0001-11-30T00:00:00+05:53

2005: A peak-time Delhi-Mumbai std call costs Rs 10 a minute, one-third of today’s rates. Two more years down the line, it’s down to local call rates. Pipe dreams?

Maybe not. "STD calls at local call rates are very much possible," says former MTNL chairman S. Rajgopalan. "Today, when a customer pays Rs 100 for an STD call, the cost to DoT (Department of Telecommunications) is only Rs 25." No wonder, the DoT has a Rs 7,500-crore surplus on a turnover of Rs 17,700 crore, of which Rs 12,500 crore comes from long-distance services.

And with the country’s Internet boom increasing the need for transfer of data over long distances, the market is set to grow at a rapid pace. Says N. Arjun, who is spearheading the Bharti group’s long-distance telecom venture: "Today, data constitutes only five per cent of LD telecom traffic. But it is growing at 120 per cent a year. In five years, it will be 60 per cent of the market." Since price elasticity is high in the std market, if prices come down, the voice market could boom...

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