BSNL to reduce 3G tariffs by 50% after phase 8 of network expansion, can this be a game changer?

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BSNL the state-owned telecom operator in association with MTNL is the only operator to currently hold Pan India 3G spectrum. BSNL offers 3G data at the market price of Rs.175 for 1GB and Rs.251 for 2GB. Due to its affordable tariff and Pan India free data roaming, BSNL has a large market share of mobile data subscribers.



BSNL has been in the process of network modernisation and expansion and is currently in the phase 7 of expansion which is expected to be completed by June this year.

Mr. Anupam Shrivastav the chairman and MD of BSNL told PTI “We estimate that 3G data rates can be reduced by at least 50 per cent compared to prevailing rates under phase 8 of our network expansion” when asked as to why the tariffs can’t be reduced with immediate effect? Shrivastav replied saying “We have utilised over 90 per cent of 3G capacity. If we reduce tariff right now, there can be sudden increase in traffic and network may not be able to bear the load. Once we expand this capacity to handle adequate traffic under phase 8, we will reduce rates”

BSNL has invested Rs.4800 Crore in the phase 7 expansion and is expected to float the tender for phase 8 in the first quarter of financial 2015-16. BSNL has been in a lot of financial stress lately and the telecom minister has been taking special interest in the revival of state-owned telecom companies. BSNL has surrendered its BWA spectrum in most circles and received a refund for the same which it is using for the network expansion. Recently BSNL declared it will be signing a bilateral 2G roaming agreement with Bharti Airtel which will give it better coverage in urban areas. BSNL’s wireline business will also get a boost with the cancellation of interconnect charges for landline making it popular again. And after slashing 3G tariff by 50% BSNL will come neck to neck with the private telcos. It looks like BSNL is doing everything in its power to prevent the ship from sinking.

Let us know your views through your comments.

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Esmail is our very own in-house spectrum specialist. He is passionate about Telecom, DTH and OTT video streaming apps. When not writing an article, you can find him binge watching shows on Netflix while sipping on a cup of coffee.

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