The Hindu Business Line : TRAI reduces port charges; tariffs may drop

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New Delhi Feb. 2 In a move that could result in lower telecom tariffs, the Telecom Regulatory Authority of India (TRAI) has decided to reduce a charge paid by operators to each other, called port charges, by up to 29 per cent.

Port is the place where two operators interconnect with each other for which the operator that provides the connection takes a fixed fee.

The minimum charge paid by the operator that seeks interconnection at present is Rs 55,000 per annum, which has been brought down to Rs 39,000.

The new charge would be effective from April 1 onwards.

TRAI said that it hoped that the operators would pass on the benefits of the reduction to consumers.

With the induction of the competition in telecom sector in the country, the interconnection among the operators has become an essential requirement for the development of the sector.

In the multi-operator multi service scenario, establishment of interconnection helps the consumers of one network to communicate to the consumers of other network. While the move will benefit private telecom operators, it could have revenue implications for State-owned Bharat Sanchar Nigam Ltd (BSNL) because it has the largest fixed line network and in majority of cases it is the interconnection provider. Reduction of charges would mean BSNL would get lower revenues from providing access to its 40 million subscribers.

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