Vodafone, Idea end one paisa call tariff in selected circle

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Vodafone Essar and Idea Cellular have joined their peers Bharti Airtel and Tata Teleservices in selectively upping tariffs for voice calls.

The two telecom operators have increased tariffs on their per second billing plans by 20 per cent in certain circles, industry sources close to the development said.

While Bharti Airtel increased tariffs last week, Tata Teleservices upped prices late last month. Industry watchers say that the older telecom operators are testing the waters to see how their existing customers react to the price increase, before rolling out a new pricing regime on a pan-India basis.

Three circles

Vodafone, which is the country's second largest GSM operator, is said to have increased ‘Vodafone to Vodafone' call rates to 1.2 paise per second from one paisa. These hikes have been implemented in the circles of Delhi, Gujarat and Andhra Pradesh, sources said. Effectively, Vodafone has standardised call rates (for both local and STD calls) at 1.2 paise in these circles.

A spokesperson for Vodafone did not comment on the development.

A sources said that Idea Cellular too has tinkered with call rates in Delhi and few other circles for off-net calls, which refer to calls made to networks other than Idea Cellular. While ‘Idea to Idea' calls will continue to be at one paise per minute, off-net calls will cost 1.2 paise per second.

Moreover, once the one-year validity associated with per second billing plans ends, most per second calls on the Idea network (in these circles) will standardise at 1.2 paise per minute, they said.

The Idea Cellular spokesperson refused to comment on the development as the company is currently in a silent period before its quarterly results are unveiled tomorrow.

The Indian telecom industry saw signs of an uptake in pricing after Tata Teleservices, which had ushered in a tariff war with its per-second billing-based GSM offering two years ago, decided to revise rates for all new subscribers of Tata DoCoMo in June.

Bharti Airtel followed suit by hiking tariffs by 20 per cent on two plans - Advantage and Freedom – for calls and SMS' sent within the Airtel network.

Lowest in the world

At one paise a second (for voice calls), base tariffs in India are the lowest in the world. This is becoming increasingly unviable for operators given their high investments in procuring 3G airwaves. While most operators have selectively launched 3G services, it has still not taken off due to a host of reasons.

In fact, shares of listed telecom operators Bharti Airtel, Idea Cellular and Reliance Communications have been generating a lot of buying interest on bourses ever since this new wave of price hikes started.

However, on Friday, the Idea Cellular scrip was down by 1.69 per cent to close at Rs 90 on the BSE.

Friday, July 29, 2011 by deivam P Mohanraj · 0