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ShareNEW DELHI: Mahanagar Telephone Nigam Ltd (MTNL) is learnt to have negotiated "good rates" with big brother Bharat Sanchar Nigam Ltd (BSNL) for carriage of its long-distance traffic other than on the Delhi-Mumbai route.
The two PSUs are yet to strike a deal, but sources said the rates for carrying MTNL's long-distance traffic would be lower than 65 paise per minute, which is the carriage charge ceiling set by the telecom regulator. Also, indications are that two rate slabs may be worked out - one for remote places and another for the more lucrative routes.
BSNL offers access to most remote parts of the country and has been carrying MTNL's long-distance traffic across the country. However, MTNL finds the carriage rates quite steep and has long wanted BSNL to slash the rates from 65 paise per minute now to around 40-50 paise per minute.
Despite a series of deliberations, though, the two sides had failed to arrive at a consensus on an appropriate carriage rate. A few months ago, MTNL bagged a national long distance (NLD) licence, with which it opted to carry the Delhi-Mumbai traffic on its own and was planning to tie up with private players like Reliance and Bharti for carriage of its long distance calls for the rest of India till its own infrastructure was put in place for the same.
But now, industry sources say MTNL is close to an agreement with BSNL on carriage rates for routes other than between Delhi and Mumbai.
Till recently, only BSNL, Reliance, Videsh Sanchar Nigam Ltd (VSNL) and Bharti had licence to carry long-distance phone traffic in the country. However, the government reduced the licence fees for NLD and ILD licences with effect from January 2006, thereby attracting several players for the same. Among others, mobile service providers such as Hutchison-Essar and Idea Cellular have been cleared by the government for long-distance licence. The entry fee for NLD services has been reduced from Rs 100 crore to Rs 2.5 crore, while the annual licence fee has been brought down from 15% to 6% of the adjusted gross revenue of a company.
When MTNL decided to go on its own for carrying the Delhi-Mumbai STD traffic by leasing bandwidth from VSNL recently, officials said it was a much cheaper option. MTNL's payout was estimated to be slashed by Rs 8-10 crore per year on the Delhi-Mumbai route once it stopped riding on BSNL. There are around 40 lakh MTNL fixed phone subscribers in Delhi and Mumbai. According to estimates, the Delhi-Mumbai STD traffic of MTNL makes for around Rs 150 crore worth of revenues a year. The NLD market is estimated to be around Rs 4,000 crore, of which the Delhi-Mumbai route accounts for Rs 1,000 crore or so.
According to data available with the Telecom Regulatory Authority of India, on an average, a fixed line user makes 1,000 minutes of calls every month, of which 20% is in STD calls. In the case of mobiles, on an average, 300 minutes of calls are made per subscriber per month, of which STD calls account for 10-15%.
