TRAI (Telecom Regulatory Authority of India) has issued a draft amendment to reduce the ceiling tariff for national roaming services. TRAI has proposed to reduce the ceiling on national roaming voice tariff by ~35% and national roaming SMS by ~80%. Incumbents' tariff plans suggest the current roaming tariffs are largely priced at existing ceiling rates; however, special tariff vouchers with discounts on roaming minutes are available.
TRAI is of the view that the reduction in ceiling tariff will result in an increase in roaming outgoing as well as incoming minutes. TRAI had last cut the ceiling on incoming roaming minutes by 25% (Rs 1/min to Rs 0.75/min) in 2013. Since then, incoming roaming minutes per outroamer per month has increased by 26%; however, outgoing minutes per outroamer per month has been unchanged.
Currently, mobile roaming revenues constitute ~9% of overall wireless revenues for the telecom operators. Reduction in the national roaming ceiling tariff would imply ~3% revenue impact and ~5% EBITDA impact for operators, but this could be partly offset by an increase in roaming minutes.
