In what is being seen as a boost for Reliance Jio, the Telecom Regulatory Authority of India (TRAI) has decided to cut mobile interconnect usage charges (IUC) from 14 paise a minute now to 6 paise a minute from October 1.
Putting an end to the long-pending issues of mobile IUC or termination charges, TRAI on Tuesday came out with a notification.
Termination charges are the charges payable by a telecom operator whose subscriber originates the call to the operator in whose network the call terminates.
While the mobile-to-mobile termination charge has been reduced, TRAI has decided that for other types of calls (such as wire-line to mobile and wire-line to wire-line) the termination charge would continue to remain zero.
From January 1, 2020 onwards the termination charge for all types of domestic calls shall be zero, TRAI said.
The prevailing IUC Regulation was notified on February 23, 2015, and came into effect from March, 2015. TRAI issued a consultation paper for review of the IUC on August 5 last year to seek stakeholder views on various aspects of the IUC.
Based on the comments and counter comments from stakeholders and open-house discussions with them in the consequent months, TRAI has decided to revise the domestic mobile termination charges through these regulations.
However, apart from Reliance Jio, incumbent telecom operators such as Bharti Airtel, Vodafone India and Idea Cellular are likely to lose their benefits from IUC. These operators wanted the termination charges to be raised and benchmarked against the actual cost.
The latest entrant, Reliance Jio, on the other hand, had been seeking waiving of the charge, saying such a move would benefit consumers.
According to sector experts, Reliance Jio is likely to gain ₹3,840 crore per annum with the IUC rate announced on Tuesday, based on the current subscriber base and traffic.