Airtel Takes a Roaming Exit; Now All Calls Will Feel Like Local

Bharti Airtel has decided to do away with all national roaming charges for incoming/outgoing calls and SMSes with effect from April 1, 2017.

The company said in a statement,"Users roaming outside their home network, will not be charged extra for making local or STD calls, while home data and voice packs for customers will apply even while roaming across other circles."

This can be seen as one of the after-shock effects of Reliance Jio's prive competive strategies, Airtel is now going to reduce international roaming charges too by almost 90%. The news has been welcomed and the Aitel's customers have been in a celebratory mood.

However, for the telecom majors like Vodafone, Reliance & Airtel, the national roaming charges account for only 3-4.5 per cent of the company’s revenue and international calls' revenue is even smaller, but these two are more of an inconvenience to subscribers, it was better to keep up with the cartel and re-organize itself & be prepared for the war. Other telecom players are likely to follow this move or make a similar one.

On the national front, incoming roaming charges is 45 paise per minute, which will be totally abolished. For outgoing calls roaming charges will be removed so one will have to pay only the local outgoing charges, which is around Rs 0.50 per minute. Earlier, a local roaming charge of 0.80 per minute was levied and Rs 1.15 per minute for STD calls. These charges will be removed, virtually ending what is known as roaming rates, this is more like end of an era.

Gopal Vittal, MD & CEO (India & South Asia), Bharti Airtel, said: “This marks the death of national roaming and the whole country will now be like a local network for our customers, who will not have to think twice before making or receiving calls or using data while travelling outside their home base. Airtel has again set the benchmark in delivering best in class value backed by a great network experience.”

Since Reliance Jio does not charge for voice calls, there’s no concept of roaming there, Bharti Airtel had to inevitably follow.

Previously the Average Billing Order
On average, incoming calls are billed at around Rs 50 per minute, outgoing at Rs 150 a minute and SMSes at Rs 15. Bharti had last year in September made incoming calls free in popular destinations like the US, Canada, the UK and Singapore. It did this by offering international travellers a daily pack and a monthly pack for around Rs 649. Anyone subscribing to it would get all incoming calls free, while outgoing to India as well as local calls will be charged at Rs 3 per minute after 100/400 free minutes while data charges will be at Rs 3 per MB.

What Bharti has now done is to protect even customers travelling international without a pack. In their case, through an automatic adjustment, charges will be made equal to the daily pack for that particular country. This means that the moment a customer’s billing reaches the price of a one-day pack for the country, he/she will be automatically moved to that pack.

Most, importantly, even post the exhaustion of pack benefits, customers will continue to enjoy extremely attractive rates. Though, the call charges have been cut by up to 90 per cent to Rs 3 per minute and data charges by up to 99 per cent to Rs 3 per MB across popular roaming destinations.

What is Airtel's Gain?
Cutting international roaming charges won’t hurt since international pacts are done on the basis barter deals. This means that the subscribers of overseas operators will also be charged on similar lines if they roam on Bharti’s network in India. Incumbents like Bharti would have an edge over Jio in the international roaming part because overseas operators do barter deals based on subscriber base and a new entrant takes time in cutting such deals.

However, Airtel’s move also comes at a time when it has been losing subscribers and a significant amount of revenue following Reliance Jio’s launch, which is offering free unlimited calls and data (capped at 1GB per day). The Mukesh-Ambani owned telco had unveiled a new set of tariff packs in this month and mentioned that roaming charges will not apply on its network.

TRAI was first to take a stand
Airtel is not the first to make the decision to do away with roaming charges, first was state-owned telco BSNL, it abolished roaming on its network in June 2015. It was one of the first moves when Mobile Number Portability (MNP) was rolled out. Prior to this, telecom regulator TRAI had instructed telcos to reduce ceiling tariffs for national roaming calls and SMSes and had also mandated telcos to offer a special roaming tariff plan to pre-paid and post-paid subscribers.

BWDisrupt's Take: The situation in the telecom sector as of now, is very well showcasing how important it is to be a disruptor in any market. Not only to think differently, ahead of others but also take the lead in implementing the changes. It is significant that telecom companies accept the wave of data and reducing charges due that. Note that the Indian government had planned to remove roaming charges in 2012 and TRAI had subsequently issued a consultation paper asking whether how to recover costs if incoming calls were made free on roaming. However, some telecom companies had preferred not to remove roaming charges, now since it is high time to understand a customer's wants and adjust with it or else be ready for huge customer base loss. It is quite understandable that all this happened when Reliance Jio took the lead among the private players but even now only Airtel, Jio, and BSNL have abolished roaming charges on its network, definitle rival operators to do away with roaming charges.