Mahanagar Telephone Nigam Ltd (MTNL) has earned Rs 275 crore from private cellular operators who feel they will be subsidising their competitor when the telecom PSU starts its cellular service.
Four private cellular operators _ Bharti Cellular and Sterling Cellular in Delhi, and Hutchison Max and BPL Mobile in Mumbai _ paid MTNL Rs 135 crore in 1997-98 by way of access charges alone. Access charges are levied upon one operator by another to carry and complete a call.
MTNL and the department of telecommunications (DoT) charge cellular operators Rs 1.40 per pulse as access charges. A pulse is a charging unit, the time-length of which depends on whether the call is local or long-distance. For instance, the pulse rate used for local calls has a duration of five minutes, but is in the range of 2 to 128 seconds in the case of national and international long distance calls.
Besides the access charges, sources say, MTNL has also registered a substantial increase in its own revenues accruing from calls made from fixed-line telephones to cellular phones. They estimate that the telecom PSU earned Rs 140 crore by way of such calls.
A total of Rs 275 crore is being generated on MTNL's profit and loss account directly and indirectly, they point out, by the cellular operators. "More than Rs 75 lakh a day is being paid to MTNL. The payment is made ahead of time before the bills to consumers are raised," one of them explained.
Industry sources fear that MTNL, which has been given the go-ahead by the Delhi High Court to start cellular services in Mumbai and Delhi, will indirectly benefit from revenues directly and indirectly generated by private cellular operators. "The operators will be indirectly subsidising their own competitor," they say. MTNL's entry into cellular services _ targeted for March 1999, but to be delayed because the operators will appeal against the court verdict _ has been a source of worry for the Delhi and Mumbai cellular operators. They have been demanding the government (DoT, in this case) ensure a level playing field before MTNL is allowed into cellular services. Either the same licence fee (Rs 5,000 per subscriber annually) should be imposed on MTNL or the government should reduce their licence fees, they say.
The private operators claim that MTNL enjoys an unfair advantage since its costs will be lower on account of waiver of the licence fee and common infrastructure that it will share with its basic telecom business. For instance, MTNL can use its buildings and rooftops to erect radio base stations and can use a common workforce to service its basic and cellular service operations. Cellular operators spend between 12 and 15 per cent of their revenues on personnel costs.
