Reliance Jio prevails over Airtel, Idea as Trai cuts IUC

20 September, 2017, 01:05 | Author: Rolando Keller
  • Telecom operators to seek legal help against TRAI's IUC slashing

In the letter, which was written before TRAI's decision was made public, the company showed concern at the potential introduction of a Bill-and-Keep (BAK) regime or a reduction in IUC.

The Trai, in its explanatory memorandum, said: "While on the one hand, a lower termination charge benefits the consumer, it does not have a negative effect on the telecom operator because it is open to the operator to recover whatever costs it incurs through the retail tariffs, subject to competitive market conditions".

The telecom regulator on Tuesday slashed termination charge on mobile voice calls to 6 paise a minute, from the current 14 paise per minute which would reduce cost of such calls.

Telecom Regulatory Authority of India (TRAI) decreased domestic termination charges more than half from 14 paisa per minute to 6 paisa per minute for calls between two mobile numbers. The older telecom players wanted it raised to at least 30 paise per minute.

Joy for Jio, jolt to Big 3

Trai said it is of the view that termination charges work as disincentive to the deployment of new technologies such as VoLTE and migration to IP networks by operators.

"Whatever the Trai does, another court battle is on the cards".

Reliance Jio had said in a presentation to Trai recently that telecom operators gained to the tune of Rs 1 lakh crore from IUC.

Newcomer Reliance Jio, which has been aggressively selling its services by offering deep discounts and free handsets, has sought lower interconnect charges as its subscribers make more calls to rival networks while paying lower rates. "And that is going to be a problem because the amount of revenues involved will be very large and the guys who are existing incumbents are not going to take it sitting down", he said. However, TRAI has been in support for reducing IUC charges off late. This is expected to bring down mobile call costs in coming days. Jio also stated that it is of the opinion that waiving the charge will benefit consumers.

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