Indian Telecom Pricing Methods
TELECOM PRICING
CONSULTATION PAPER ON CONCEPTS,
PRINCIPLES AND METHODOLOGIES III. EXECUTIVE SUMMARY
I. OBJECTIVE OF THIS PAPER
1. This paper introduces various concepts, principles and methodologies for determining telecom tariffs and interconnection charges (i.e. charges paid by one operator to another for use of the latter’s network in delivering the telecom service). The purpose is to provide a basis for comments and suggestions from interested parties and the public to take forward the process of developing pricing mechanisms for telecom tariffs and to provide guidelines for interconnection charges. Besides explaining the main features of different methodologies, a number of options have been listed and questions posed to focus attention on clarifying various aspects for discussion on a comprehensive pricing methodology for the telecom sector.
II. IMPORTANCE OF TELECOM
2. The progressive transformation of telecom technologies and products has resulted in a large decline in world-wide telecom costs and emergence of a variety of new markets and opportunities. Due to these developments, the telecom sector has become connected with a growing number of activities, and has emerged as a major modernizing and dynamic influence in several parts of the world. An efficient and widespread telecom network is increasingly becoming a necessary infrastructure to utilize and develop various technologies, and to achieve both economic and social goals.
3. For India, the gap between the actual situation and the likely opportunities is highlighted starkly by its low teledensity, both at present and as expected at the turn of this century. This suggests an urgent need to invigorate the telecom sector in India. Pricing methodology is an essential component of any attempt to infuse dynamism in this sector.
III. TELECOM TARIFFS
1. Objectives of telecom pricing methodologies
4. Prices are an important means to achieve policy objectives. The telecom sector’s objectives
CONSULTATION PAPER ON CONCEPTS,
PRINCIPLES AND METHODOLOGIES III. EXECUTIVE SUMMARY
I. OBJECTIVE OF THIS PAPER
1. This paper introduces various concepts, principles and methodologies for determining telecom tariffs and interconnection charges (i.e. charges paid by one operator to another for use of the latter’s network in delivering the telecom service). The purpose is to provide a basis for comments and suggestions from interested parties and the public to take forward the process of developing pricing mechanisms for telecom tariffs and to provide guidelines for interconnection charges. Besides explaining the main features of different methodologies, a number of options have been listed and questions posed to focus attention on clarifying various aspects for discussion on a comprehensive pricing methodology for the telecom sector.
II. IMPORTANCE OF TELECOM
2. The progressive transformation of telecom technologies and products has resulted in a large decline in world-wide telecom costs and emergence of a variety of new markets and opportunities. Due to these developments, the telecom sector has become connected with a growing number of activities, and has emerged as a major modernizing and dynamic influence in several parts of the world. An efficient and widespread telecom network is increasingly becoming a necessary infrastructure to utilize and develop various technologies, and to achieve both economic and social goals.
3. For India, the gap between the actual situation and the likely opportunities is highlighted starkly by its low teledensity, both at present and as expected at the turn of this century. This suggests an urgent need to invigorate the telecom sector in India. Pricing methodology is an essential component of any attempt to infuse dynamism in this sector.
III. TELECOM TARIFFS
1. Objectives of telecom pricing methodologies
4. Prices are an important means to achieve policy objectives. The telecom sector’s objectives