Telecom policy seeks FWP as fixed services

The National Telecom Policy-2005 (NTP-2005) is seeking to admit Fixed Wireless Phones as fixed services, as the Department of Telecommunication believes this will help achieve India's teledensity target of 250 million by 2008.

"Keeping in view the affordability of telephony services for the masses essential to achieve teledensity targets of 250 million by 2008, NTP-2005 is likely to include the admissibility of FWPs as fixed services. The draft of NTP-2005 has sought the admission of FWP services, based on the criteria of premises-based fixed services admissibility," a DoT official said on conditions of anonymity.

This will come as a reprieve to companies that are presently providing FWP services, like Bharat Sanchar Nigam, Mahanagar Telephone Nigam, Reliance Infocomm and Tata Teleservices, as the draft of the policy has sought admission of the services under fixed offerings.

DoT has finalised the draft of NTP-2005, which would be submitted to the telecom commissioner and later posted on its website to garner opinion from the public and industry.

The draft is expected to be out, after approval from the telecom commissioner, on Friday, October 21. At present, FWPs are being marketed on terms similar to fixed phones, where the entry-level is Rs 800 and recurring call charges cost Rs 1.20 for three minutes.

FWP services are cheaper than mobile phones that come at effective call tariffs of Rs 3 per minute. The difference in costs and capital expenditure would enable a higher penetration of telephony, resulting in meeting the target, he said.

Earlier, DoT had stated that FWP was a mobile service due to the spill over of signal in areas outside the premises of installation. Mobile service operators wanted FWP to be termed as a mobile service offering and foot a higher access deficit charge as they claim that the services were providing mobility to the user. India will have to add another 140 million subscribers in the next 36 months to achieve the 250 million subscriber target.

This means that 3.88 million phones need to be added every month for the next three years in order to meet government projections.

At present, the monthly subscriber acquisition is growing at an average rate of 3 million, due to which teledensity targets would fall short by 32 million subscribers, he said.