Indian telecom to see tariff consolidation: Bharti Airtel

The telecom sector will witness a consolidation of tariffs in the next one to two years as the business models of many new operators were not viable, a senior Bharti Airtel official said here Monday.

"I feel consolidation in terms of tariffs will happen in one-two years, which should lead to some stabilisation," Bharti Airtel chief executive and joint managing director Manoj Kohli said on the sidelines of the World Economic Forum's India Economic Summit.

"Business case of many of these operators is not viable. Price is a short term situation as many new operators will not be able to continue for long," Kohli told reporters.

Regarding the mobile termination charge (MTC), a payment that one telecom operator has to make to another operator on whose network the call gets completed, he said: "TRAI changed MTC in five years on April 1. It is too recent for it to consider revising it again."

TRAI or the Telecom Regulatory Authority of India is the national sectoral watchdog.

According to Kohli, rates would stabilise on their own and MTC had nothing to do with lower tariffs. "I don’t see a reason to lower or change it again.”

Bharti, which is running a pilot scheme in collaboration with State Bank of India for enabling mobile payments in certain parts of the country, said it was in discussions with the Reserve Bank of India (RBI) to finalise a full-fledged launch.

“The details will be worked out by RBI,” Kohli said.

When asked how much the new initiative would add to the company’s revenue, he described it as being more of a social objective than a revenue channel, as the rural poor would be included in the banking system.

“We see it as a huge social opportunity instead of a revenue opportunity. We will be open to all the banks as it is a partnership model and not just an individual effort.”

Kohli also said the service would be launched “only when policy issues are resolved”.

Last updated on Nov 9^th, 2009 at 16:37 pm IST--IANS