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Cellular subscriber base grows 50% in 1999 - Views on News from Equitymaster
 
 
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  • Mar 6, 2000

    Cellular subscriber base grows 50% in 1999

    The cellular subscriber base has grown by 50% during the year 1999 to touch 1.58 m. A large chunk of the rise in subscribers took place in the latter half of the year.

    The Telecom Regulatory Authority of India (Trai) had implemented the new tariff regime in the latter half of the year. This had resulted in a dramatic decline in airtime charges. However, the decision to implement the calling party pays (CPP) regime had to be deferred due to some disagreements. It is expected to be in place once the new regulatory body is constituted.

    The lower airtime charges and the expectations that the CPP regime will be implemented probably contributed in a significant manner to the rise in demand. However, it needs to be pointed out that the growth continues to lag estimates. The government's recent initiative to bring down the import duty on hand sets to 5% is also likely to further stimulate demand for such services as capital costs decline.

    For the cellular subscriber base to grow significantly the implementation of the CPP regime is a necessity. As and when this is implemented the subscriber base will almost surely witness a surge.

     

     

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