Airtel slashes STD, roaming rates by up to 43%

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India's leading mobile operator Bharti Airtel on Monday slashed STD and roaming tariffs by up to 43 per cent benefiting its 62 million customer and starting a new price war in this segment after local calls.

The company has reduced STD rates by 43.39 per cent to Re 1.50 minute from the earlier Re 2.65 per minute. The new tariffs would be effective from April 30 and would be available for both pre and post-paid users.

According to the new tariff plan, roaming charges for incoming calls would be cut to Re 1 per minute from the present Rs 1.75 per minute, a reduction of 42.85 per cent.

Further, Airtel customers, while on roaming would be able to make local calls at Re 1 per minute and an STD call at Re 1.50/minute.

The move by Airtel is expected to start a similar trend among all cellular operators like Vodafone Essar, Reliance Communications and Tata Teleservices to get more customers.

A Vodafone Essar spokesperson said: "The company has always endeavoured to deliver best value to customers and we will offer them the best value in this instance too."

It must note that, Telecom regulator TRAI has been urging operators to reduce roaming rates for while, saying they have been on the higher side. TRAI has already abolished practice of levying Access Deficit Charges (ADC) on private operators.

Bharti Airtel President & CEO Manoj Kohli said: "Many users switch off their phones while on roaming as they feel the incoming rates are very high. We plan to check that with this reduction."

Asked about the hit the company would have to take following this reduction, he said, whatever is the impact that would be offset by the elasticity of volume, adding "this initiative will particularly benefit rural customers."

During the fourth quarter of 2007-08, Bharti Airtels' average revenue per user in the mobile segment dipped from Rs 390 in the previous year to Rs 357, although minutes of usage has increased from 478 per user per month to 507. Mobile services contributed 82 per cent of the company's revenues.