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Cell firms' long-distance plans hit a roadblock

Thomas K Thomas

Even as companies such as Bharti and Data Access are on the verge of launching its long distance services, the revenue sharing arrangement with private basic operators is turning out to be major bottleneck with the latter wanting a larger chunk of the revenues.

Bharti, which had launched its national long distance operations almost three months, still does not have any agreement with basic operators.

According to industry sources negotiations between Bharti and private operators has got stuck since Bharti is offering only 25 per cent of the revenue from an STD call to basic operators who want at least 60 per cent of the revenues as given by Bharat Sanchar Nigam Ltd. "Bharti does not want to give termination charges to us." said a basic operator.

On the international long distance front, private basic operators are asking for 60 per cent of the revenues as compared to the existing 45 per cent offered by VSNL.

"The existing revenue share for basic operators is slated to come down with the tariff re-balancing based on cost. So while we are offering a revenue share that is futuristic , basic operators are wanting the current rates," said a Bharti official.

Data Access, which has also bagged ILD licence, has in fact decided to enter into an agreement only with BSNL and MTNL for the moment. "Agreements with private operators will happen only in the second phase as BSNL and MTNL have the major share of the market," said Sidharth Ray, chief executive officer, Data Access.

On the other hand, long distance operators are making a beeline to enter into a revenue share agreement with cellular operators as mobile service provider currently get only 5 per cent of the revenue from long distance calls. This gives lot of scope for the new ILD and NLD operators to offer a better revenue share.

Bharti, which is expected to get approval of its tariffs from the Trai soon, has already approached cellular operators with a 25 per cent revenue share from the ISD calls while Videsh Sanchar Nigam Ltd has also offered to revise the existing share of 5 per cent to about 30 per cent.

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