Per second billing simplified: Who introduced it and what’s in store for you ?

‘Per second billing’ has been making news for quite a while now with some of the major operators taking a plunge and introducing per second billing for all its prepaid users.

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Idea recently announced that it is shifting its 1.5 million prepaid customers who were on per minute billing (PMB) plan to per second billing (PSB). Apart from the 1.5 million, who will be shifted over the next 30 days, the rest of its prepaid users are already on per second billing. This write up is an effort to simply ‘Per Second Billing’ for our readers so as to help them understand its impact on their pockets and way forward.

WHAT is per second billing plan?

Per second billing means that you pay by the second e.g. if your call lasts 2.5 minutes, you are charged for 2.5 minutes. Similarly, if your call lasts 2 seconds you are charged for 2 seconds and not for the entire minute. However, in case of per minute billing you pay by the minute i.e. you pay the full rate even if you used only 1 second of the last minute. Per second billing is better value for a consumer.

WHO introduced per second billing plan?

Price wars have always been a hot topic in the telecom industry. Every time somebody reduces prices, the competition follows resulting in a price war among telecom companies. Tata Teleservices Ltd’s, Tata DoCoMo was the first operator to announce that it will bill at the rate of one paisa per second i.e. per second plan in 2009. In Nov 2009, it extended the one paisa per second plan to roaming services also. The other competitors of Tata DoCoMo had to follow suit and soon all operators including market leaders Bharti Airtel, Vodafone and Idea Cellular launched per second plans. This resulted in a major price war in the telecom industry that had far-reaching effects.