A new frontier opened up in the telecom tariff wars on Friday, with Reliance Communications announcing that it will offer its customers the facility of sending SMSes for a mere 1 paise/SMS. The Reliance offer follows a ToI report on November 5, which revealed that while companies have been charging consumers 50 paise to Re 1 per SMS, it actually costs them less than a single paise to send.
This was followed by many representations to telecom regulator Trai by consumer organizations and members of Parliament seeking immediate intervention to lower tariffs. Last week ToI was told by Trai chairman J S Sarma that it would intervene to review SMS tariffs in view of the public pressure, representations and cost data. Within a week of these developments, Reliance has triggered off an SMS tariff war, which is expected to spread like wildfire across all major operators.
Reliance is offering SMS at 1 paise each or unlimited SMSs at Re 1/per day. The new SMS tariffs are add-on plans and are applicable for all Reliance mobile customers irrespective of CDMA or GSM network as well as prepaid and postpaid customers. Irrespective of their current tariff plans, consumers on the Reliance network can avail of the 1p/SMS plan by subscribing to a standard tariff voucher of Rs 11/month. The unlimited SMS plan can be availed on a daily deduction of Re 1/day from consumers prepaid balance.
Given that the cost of sending an SMS is just a fraction of a paise, this move will still allow telcos to make money while reducing the tariff burden on consumers in a significant manner. Speaking to ToI, Reliance Communications president Mahesh Prasad said that this competitive step may prompt the regulator to reconsider its stated intention to intervene in SMS tariffs.
Lower SMS costs are expected to catch the fancy of the youth and office-going consumers. This in turn will put pressure on other operators like Bharti, Vodafone, Idea, Aircel, Tatas and MTNL /BSNL to respond.
An average mobile user sends 25 SMSes every month, says Trai
This costs roughly Rs 25 a month at present
New tariff plan means mobile users will now pay no more than 25 paise a month for the same usage
This will be a reduction of 99% on today’s SMS bill
Courtesy: Shalini Singh | TNN
