It’s Reliance Jio versus incumbent operators again as telecom companies including Bharti Airtel, Vodafone and Idea Cellular tussle with the new player Jio over the issue of interconnection usage charge (IUC).
While Airtel, Vodafone and Idea on Tuesday demanded that IUC should be doubled, the new entrant Reliance Jio asked for doing away with IUC.
A telecom operator gets IUC for every incoming call from the network of the other service provider. The rate is fixed by telecom regulator Trai. The current IUC rate is 14 paise per minute and is included in the mobile tariffs.
In a day long workshop organised by the Telecom Regulatory Authority of India (Trai) on the issue of IUC, incumbent operators said that terminating incoming calls on their networks costs 30-35 paise per minute and the current IUC rate should be doubled.
Airtel said their cost of carrying incoming call is 30 paise, while Vodafone said the cost of carrying incoming calls on its network is 30 paise without taking into account the licence fees and 34 paise after including it.
Idea Cellular said the cost of carrying incoming call on its network is around 30 paise as per methodology used by Trai, while as per its own calculation, the cost is 35 paise per minute.
Operators were of the view that they are unable to recover their basic cost at the current IUC rates.
“Today all the major operators participated. Some operators were of the view that we should go to bill and keep, others asked for reducing it, some said keep it constant at the current level,” Trai chairman R S Sharma said after the workshop.
Now, there will be an open house session by Trai, subsequent to which the regulator will finalise its view on the issue.
Any change in IUC has a direct impact on mobile call tariffs as the charge is taken into account while setting telecom tariffs.
Sharma did not give any timeframe for firming up the IUC recommendations but said they will be finalised soon.
Trai in a Supreme Court affidavit in 2011 had said that telecom operators should be given time till 2014 to move to bill and keep regime. Under this, operators only keep a record of incoming calls on their network but don’t raise any demand from other operators.