India to finally unrestrict VoIP

Even though India supplies the world with software and IT engineers, till now it was not possible for people living there to fully use VoIP facility. It was illegal to call any phone using the computer. This is about to change at the Telecom Regulatory Authority of India (TRAI) has proposed that people be allowed to make calls using internet to fixed lines.

What does it mean for the people? Well, the price of domestic long distance calls is supposed to halve to less than a penny (just over a cent) and international calls are supposed to get cheaper by 20%. It would also become cheaper for people to call India from abroad. Already in UK, Vodafone is allowing people to call India from a Pay as you talk phone for just 5 p per min.

This may also help the Indian call centres as right now, the onshore companies have to pay termination charges when the calls get routed to India. This would mean that Indian call centres may become cheaper and more competetive.

Now for the small print; only the ISP's will be permitted to compete with the telephone companies using this VoIP. The fixed line and the mobile operators are up in arms about this because the ISPs are going to get free money whereas the mobile operators had to pay license fees for entry into the market.

This may not be a big problem for the time being as at the moment India only has around 5 million broadband subscribers whereas there are 287 million mobile subscribers and around 40 million fixed line subscribers. Also, the call rates are so cheap that additional investment in a PC and broadband connection (which is comparatively expensive) may not be lucrative.

If the recommendations by TRAI are accepted, there will surely be a VoIP revolution in India. The existing fixed line and mobile operators will have to come up with some challenging billing models to survive in future.