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Monday, June 23, 2008

Your Indian mobile bill is a rip off

So now you know why Vodafone bade $13 billion for HutchEssar and how Telcos make money – thro pure rip off. The Internet Service Providers Association of India (ISPAI) claims that STD calls can be offered at 15 paise/minute and local calls can be free on the same network, if the government permits unrestricted domestic internet telephony. ISD call rates can further come down to 50 paise per minute on same IP network, and in other IP network 75 paise. And if you want to call on a mobile or fixed line from an IP phone, STD call rates can be offered at 50 paise per minute, claims ISPAI.

Currently, STD call rates on mobile networks are about Re 1 per minute while local rates range from 80 paise to Rs 1. Operators such as Airtel and Vodafone charge Re 1.50 and Re 2.75 per minute for a STD call whereas a call from India to the US or UK costs cheaper at 95 paise per minute, or lower through the internet protocol (IP) telephony. The same call to the US or UK through a mobile cost Rs 6.40.

Interestingly, many telecom operators currently route their domestic calls through the IP network. Says ISPAI president Rajesh Charria, “As admitted by many operators, they are routing the call through the IP networks and still charging exorbitant call rates.” Global giants such as Google, AT&T, Cisco, Microsoft and Nortel are backing the ISPs in their demand for allowing unrestricted IP Telephony.

Even with all the experimentation is going on in mobile communications, we don’t see customer benefiting in the near term. The handset landscape is starting to look like "The Island of Doctor Moreau," murky territory where industries interbreed in ways not seen before. Search companies working on handsets, handset companies working on social networking. All this may give you feature richness and the handset makers some reason to charge a higher cost for the handset, the calling costs will remain so high for customers -- it's just not natural, I tell ya.
Check this out for yourself –

a) Google, trying to herd a crowd of developers, manufacturers and carriers toward deployment of handsets based on its open source Android platform, is getting a quick lesson on the benefits of absolute monarchy over messy democracy when it comes to efficiency.

b) Nokia is working on its own transformation, from a simple handset manufacturer to a device maker that also serves as a hub for all manner of mobile communications and entertainment. Through its Ovi gateway, Nokia is integrating photo and video sharing, music services, mapping, and now, with the buyout of Germany's Plazes, location-based social networking.

c) Google is being slowed by the need to juggle all the individual requirements and schedules of a horde of stakeholders, and as a result, the launch of the first Android phones will slide toward the end of the year. So is Sprint Nextel’s efforts to get an Android phone being set back and that of China mobile having to push back its launch plans.
You might as well see that IP telephony in most developed markets such as the US, Singapore is unregulated, resulting in drastic fall in call rates. For instance, a $2.5 (Rs 100) calling card offers a 30 minute call to India from US which comes to a per minute rate of Rs 3.33 for an ISD call from US to India. Whereas in India, the mobile operators offer the same call at double the price for a call to the US. Some others offer India calling at 4.2 cents per minute or Rs 1.60 per minute, almost one-sixth the ISD rate offered by operators in India.

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