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Sunday, August 9, 2020

Telecom Regulator Slashes Cross-Network Connection Charge, Calls Could Get Cheaper

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Telecommunication Regulatory Authority of India halved the inter usage charges yesterday. From October 1, the IUC will be 6 paise. Trai has also announced that it is planning to abolish the IUC charges on all local calls from January 1, 2020. This move will benefit a lot to the new telecom Reliance Jio. Reliance Jio had already asked Trai for the abolition of inter-usage charges. The older telcos are opposing this move as it will be a big blow for these.

Here, it is important to mention that Trai was charging IUC at the rate of 14 paise. This decline in IUC means a 3800 crore profit for Reliance Jio. Trai believes that reduction of these charges would benefit the customers a lot. The experts are also of the view that this move will also increase the competition between telcos. This competition would also benefit the users.

Trai also believes that this move would prevail flat rates in the country where no telecom will pay to another. Time differentiation charges will still exist and benefit the users a lot. The older telcos also wanted it to be 30 paise. Reliance Jio wanted it to be zero. Earlier, in July Reliance Jio also claimed that older telecoms had earned about 1.04 trillion in IUC. Thus, it was pressing Trai to put in place the BAK model.

Bharti Airtel and Idea Cellular management have written to Trai for continuing the IUC. They are arguing that IUC should exist because the ratio of calls between their telecoms and Reliance Jio is asymmetric. Thus, shift to BAK model will prove useless for them.

The experts are hoping that older telecoms would challenge Trai decision in the court. They are saying that this move is disappointing for most of the telcos in the country.

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