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TRAI to review Iridium's tariff deals

The Telecom Regulatory Authority of India will review Iridium India Limited's arrangements to share revenue with cellular operators, the Department of Telecommunications and the Mahanagar Telephone Nigam Limited.

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Iridium has already finalised the deal with cellular operators. And with DoT and MTNL, it is in the process of fine-tuning the arrangements.

The tariff charged by Iridium would be 20-25 per cent over the cellular charges for the national roaming facility and at 20-25 per cent premium over the existing ISD rates for the international roaming facilities, it is learnt.

The company recently made presentations to TRAI to appraise it of the technology and the tariffs it intends to charge.

In its policy on GMPCS, the 'global mobile personal communication services' technology, the government has said that 16 per cent of gross revenues would have to be paid to it.

Iridium maintains that this is prohibitive.

Iridium India is in a position to offer roaming service to international Iridium subscribers. With the receipt of DGFT licence on November 4, Iridium India can now start customer demonstrations of service performance.

The company is also in the final stages of receiving a licence in Bangladesh.

The handsets and pagers would be available through service providers and roaming partners.

The satellite mode handset is estimated to cost $2,100 (ex-factory price) and $3,000 for a dual-mode handset with cartridge and pager and all taxes and applicable duties extra. Motorola and Kyocera manufacture the handsets.

The company plans to break even by 2000-2001 and then turn cash flow positive. Globally the company anticipates that it would need 600,000 voice subscribers to break even.

In India, it expects to have about 5,000 subscribers in the first year and gradually move up to 140,000 subscribers by the seventh year.

The company was spared punitive charges of about $30 million and is eligible for incentives of $14.25 million from Iridium LLC. The parent company has awarded the incentive because the Indian subsidiary was able to complete all requirements before November 1.

- Compiled from the Indian media

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