The subscribers base for pagers in India has eroded by over 56 per cent, from 640,000 users in March 2000 to 289,000 in March 2003.

According to the Indian Paging Services Association, the industry will be wiped out by the year-end if the government does not hurry with a relief package soon.

Already four companies -- Beltron, BPL, India Paging and Pun Paging have shut shop.

The subscriber base for pagers declined substantially in 2002-03, when the number of pagers in use fell 37 per cent from 450,000 in March 2002 to 280,000.

The minuscule number of remaining subscribers is distributed between 10 operators, squeezing profit margins and pushing these companies towards extinction.

DSS Mobile, the largest operator with services in 10 cities, has witnessed a major drop in subscriber base, from 194,000 in June 2000 to just over 70,000 in March 2003.

The dismal performance by the paging industry is in sharp contrast to the popularity of cellphones. Cellular and WLL limited mobility operators are adding more that two million new users every month.

The IPSA has said the dismal performance of paging industry was not due to technological advancements made by wireless communication, but because of the government's apathy in addressing issues raised by them.

YK Modi, chairman of IPSA, said: "Paging is a niche segment, even in a market where cellular services are growing at a rate of more than 90 per cent. In China, 60 million pager users co-exist with the 160 million mobile phone users. The same is true in the US and UK markets. The functionality of a pager has not gone, it only needs conducive policies from the government."

The main demand of the paging industry is that they be allowed to migrate from paying a fixed licence fee to a revenue sharing regime with retrospective effect.

This will lessen the financial burden of the operators and help them clear all their dues.

According to IPSA, the move would not cost the government more than Rs 40 crore (Rs 400 million), and is in line with the packages offered to cellular and basic operators. The second demand is to exempt paging service providers from paying licence fee for the remaining period.

This is in line with the package offered to Internet service providers, who pay only Rs 1 as token licence fee.

The third demand of the IPSA is that revenues earned from calls made by subscribers of cellular and basic operators when leaving a message for a paging subscriber be shared. A similar demand has also been made by ISPs.

Earlier, the Tariff Commission, under the finance ministry, had noted that paging sector was in poor shape due to the imposition of heavy licence fees.

Early this year, the government made some concessions by offering a migration package to paging companies with licences to operate at the state level.