New Internet telephony tariff to make calls to US cheaper

The prophecy which global telecom majors have feared for long, that voice will one day become free, is now on the horizon.

NEW DELHI: The prophecy which global telecom majors have feared for long, that voice will one day become free, is now on the horizon. The use of Internet for voice calls is helping crash tariff boundaries to unimaginable lows.

MTNL has become the first traditional voice provider to announce Voice over Internet Protocol (VoIP) services in Delhi, offering international calls to its broadband subscribers at Rs 1/minute.VoIP services do not require either a computer or an Internet connection, just an adaptor or an IP phone.

MTNL’s service uses SIP (Session Initiation Protocol) for transporting voice packets, which is essentially an adaptor attached to a regular phone. In IP phones, the adaptors are a part of the instrument itself.

MTNL’s offer, though welcome, comes late. Government policy allowed mobile firms the unrestricted use of VoIP to offer calls as far back as April 2006. However, while ISPs (Internet service providers) offer voice services at Re 1/minute primarily to the US, mobile operators continue to charge Rs 6.40/minute for calls to the US and Rs 9.20/minute to call the Gulf. World Phone Internet Services offer ILD calls at 95 paise/minute.

According to Trai’s latest figures, 10% of the 2,500 million outgoing ISD minutes in 2005-06 were on VoIP. Interestingly, VoIP grew a whopping 300% in 2006-07 with 800 million minutes, while total ISD outgoing minutes grew just 40% to 3,500 million minutes.

In a country that is globally recognised for being the second most talkative nation by way of telecom minutes of usage, signs of these prices being beaten down promise untold delight to consumers.

The inevitability of free voice where over 90% of the market is still vanilla voice, appears a lot closer after MNTL’s move. However, the real price threshold will come when private players follow suit. ISPs offer a serious challenge. Sify offers unlimited calls at an unbelievable price of Rs 250/month in 117 cities across India. MTNL’s price for the same service, is 10 paise and World Phone does not charge at all.

For now, interconnection between ISPs is restricted. Should this be removed, the VoIP market could simply explode.
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