The Hindu : Despite tariff hike, BSNL a market leader

Online edition of India's National Newspaper
Sunday, May 11, 2003

Southern States

Southern States - Tamil Nadu

Despite tariff hike, BSNL a market leader

By T.S. Shankar

CHENNAI MAY 10. As traffic between basic landline to cellular phones has dropped by 15 per cent over the past 10 days, in the wake of a tariff revision by the Telecom Regulatory Authority of India, the BSNL, as a major player in both the fixed and mobile telephony, is now caught in a Catch 22 situation. The public sector undertaking, with its inherent disadvantages in this highly competitive telecom sector, has to simultaneously promote both the modes.

Highly-placed Tamil Nadu Telecom Circle BSNL sources claim that despite deficiencies in the fixed line with a higher price tag and in the mobile telephony, the BSNL remains the "market leader" with a subscriber base of 28.8 lakhs in the basic phone sector, linked through 2,012 exchanges encompassing the entire circle, and 2.17 lakhs in `Cellone' cellular sector.

While the BSNL is engaged in re-working its strategies, holding open house sessions in urban and semi-urban areas on the advantages of its massive logistics and networking system, the sources say that the recent tariff revision was not the making of the BSNL, but a decision of the TRAI, which is the regulatory body. Private players have not adhered to some mandatory stipulations, such as providing access to rural areas and making available `Universal Social Obligations Fund' to subsidise the BSNL's rural telephony operations. In the absence of the USOF, "we are compelled to pass on the burden to our network customers", the sources added.

Under the new Interconnect User Charge regime, which came into effect on May 1, the BSNL's four new packages - general, economy, special, and super - are still "customer-friendly", providing a range of choices for varied segments of users, especially the middle and lower income groups, which constitute 60 per cent of its total customer base.

Admitting that the BSNL has not been adopting an "aggressive marketing strategy" to explain the advantages of the four packages in the backdrop of over 20,000 telephone connections being surrendered, the sources argue that "if a level playing field" is ensured, the BSNL would still be the winner in the present telecom war.

In the midst of this confusion, the initial response of a majority of private cellular operators to the IUC regime has been on the "happier side", as they have rolled out what they call "talk more pay less" packages.

PCOs affected

But, the new tariff has come as a "rude shock" to PCO operators. The mobile telephony operators do not want to comment right now, but the operators complain that the BSNL's attitude and the TRAI's "unreasonable tariff" "hurt" their business. Many PCO users, who were making calls to mobile phones in recent months, do not want to pay the increased rates now.

Meanwhile, the Consumer Action Group, Chennai, has charged the BSNL with providing "unrealistic cost data figures" to the TRAI on the basis of which the regulatory authority announced the recent tariff hike. "The basic telephony is now in a state of total chaos", points out Shoba Iyer, CAG coordinator. How the telephony war will unfold in the months to come depends on the response of the users.

Printer friendly page
Send this article to Friends by E-Mail

Southern States

Stories in this Section

Deemed varsities, a myth or miracle?

3 depts. failed to prevent illegal activity: CAG

Govt. doctors join strike, elective surgeries deferred

New syllabi for standards XI, XII on Internet

SP appears before SHRC in 'torture case'

Centre sanctions 4 projects for helping trafficking victims

Despite tariff hike, BSNL a market leader

'TN could have saved Rs. 145 cr. had Central funds been utilised'

Sexual harassment of women at workplace a misconduct

12 Bills passed in 75 minutes