New hope for cell users, court favours low tarrif

Justice Variava pointed out that the TRAI should work out the exact amount by which operators should reduce the tariff for cellphones.

Variava’s logic is straightforward. In March last year, for instance, the TRAI had allowed cellphone companies to hike monthly fees to Rs 600, from the existing Rs 156. And while peak airtime rates were also slashed from Rs16.80 per minute to Rs 6, the argument was that this package was essential since the cell-firms needed to pay huge fixed license fees to the government. But now that the huge license fees no longer need to be paid why should cell firms be allowed to charge huge fixed monthly charges?

Once the government changed the licensing regime from August 1, the TRAI then announced a new tariff package. They lowered the monthly rental to Rs 475, and said that users would not have to pay for incoming calls and that this would be paid for by the callers cellular firms, in turn, would get a larger share of this landline-to-cell charge. This package was then challenged in court by MTNL which argued that it would lose out from giving higher revenues to cell firms, and by a consumer organisation which said it was unfair to ask landline users to pay more for calling cellphones.

With the matter in court, cell firms are now enjoying the best of both worlds — they get higher monthly rentals and don’t have to pay highlicense fees. The consumers get the worst of both worlds — higher rentals and no free incoming calls. This is what Justice Variava indicated that he wanted changed. So, free incoming calls or not, cell charges are very likely to go down.