Trai cuts termination charge on mobile voice calls; Reliance Jio to gain

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".if you reduce the termination charge, the principal beneficiary is Jio because they are the ones dumping traffic onto other networks".

Trai said in a statement: "For mobile to mobile, the termination charge has been reduced from 14 paisa per minute to 6 paisa per minute with effect from October 1, 2017".

Telecom Regulatory Authority of India (Trai) today announced slashing of the interconnection usage charge (IUC), paid by an operator for termination of mobile call on a rival network, to 6 paise a minute from the current 14 paise.

The termination charges will be completely scrapped from January 1, 2020.

Reliance Jio, which has built up a subscriber base of 128 million since it started commercial operations last September on the back of its offer of free voice calls, had wanted the interconnect usage charge (IUC) cut to zero. The latest move by TRAI is set to benefit Jio the most, however, it has come as a setback to the existing telecom operators including Airtel, Idea and Vodafone.

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The debate over the charge was revived in August previous year, when Trai issued a consultation paper proposing to review it. Reliance Jio, the latest entrant in the telecom market, wanted the charge to be lowered and the existing calling-partypays regime eventually scrapped.

"Whilst mobile operators may seek to recover lost IUC revenues through higher retail charges to customers, in Indias intensely competitive market it is unlikely that they will be able to do so", Koong said.

The letter, accessed by BusinessLine, says that introducing a BAK regime or reducing the IUC in India is likely to have adverse consequences for investment and ultimately, it will be to the detriment of consumers.

Khullar added that the coming days could see a replay of the events in 2007, when the IUC was reduced from 30 paise to 20 paise. Jio also stated that it is of the opinion that waiving the charge will benefit consumers.