Jio's no more free, Airtel & Vodafone-Idea to make a call

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SME Times News Bureau | 10 Oct, 2019
With Reliance Jio announcing 6 paise per minute charge for voice calls to rival networks, Vodafone Idea on Wednesday termed the announcement "an action of undue haste" and Airtel termed the Mukesh Ambani-owned company's move a forced tactics to reduce interconnection charges.

"The announcement by one of the telecom service providers today to charge for calls made to other service providers to cover the termination charge of IUC is not only an action of undue haste, but it also doesn't bring out the fact that interconnect is a settlement between operators and not a consumer pricing matter.

"In our view, its TRAI's call for a consultation on IUC keeping in mind the continuing asymmetry in traffic and in line with its earlier stated position on the matter", Vodafone Idea said in a statement.

Reliance Jio's announcement follows its recent unilateral action of reducing ringing time.

Stating that Vodafone Idea operates on the singular principle of pro-consumer and pro-choice, it said, "Our offerings are transparent, affordable and cater to a cross section of society and consumers with varying consumption needs via multiple technologies 2G, 3G and 4G. Even today over 50 per cent Indian consumers use 2G and feature phones and we service them in remote parts of the country even when it's unprofitable for us to do so."

Airtel said: "One of our competitors has imposed a rate of 6 paise for all off-net calls made to other operators to cover the termination charge of IUC. They have gone on to suggest that TRAI has re-opened this issue."

On account of taking a hit of Rs 13,500 crore due to network connection charges, or interconnet usage charges (IUC), Reliance Jio on Wednesday said it would charge customers 6 paise per minute for voice calls made to rival networks till IUC charges were eliminated.

It's the first time that Jio users will pay for voice calls, free since September 2016.

Telecom Regulatory Authority of India Chairman R.S. Sharma didn't respond to calls for response to Jio's contention that it was forced to take the step due to regulatory uncertainty created by TRAI. The TRAI floated a consultation paper to review whether the IUC regime timeline needs to be extended.

The Sunil Mittal-owned company said: "On September 19, 2017, when TRAI reduced the IUC from 14 paise to 6 paise and proposed a move towards 'bill and keep' (zero IUC) with effect from January 1, 2020, it had specifically mentioned that the TRAI shall keep a close watch on developments in the sector, particularly with respect to the adoption of new technologies and their impact on termination cost. The TRAI, if deems it necessary may revisit the scheme of termination charge applicable on wireless-to-wireless calls after one year from the implementation of the regulation".

Last month, TRAI weighed the option of deferring date for scrapping IUC. It floated a fresh consultation paper to see if there is a need to revise the applicable date for scrapping IUC, given the continuing imbalance in inter-operator traffic. The paper also seeks to discuss what parameters should be looked at to decide on an alternate date, if any.

When TRAI decided to scrap IUC, Airtel, Vodafone and Idea had resisted the change, while Jio was in favour.

The possible change of timeline for introducing zero IUC, Jio said had led to the uncertainty of IUC phase-out deadline and it can't continue to bear Rs 13,500 crore losses on account of IUC by offering free voice calls to rivals' network from its network.

"The consultation paper has created regulatory uncertainty and therefore Jio has been compelled, most reluctantly and unavoidably, to recover this regulatory charge of 6 paise per minute for all off-net mobile voice calls so long as IUC charges exist," the Jio statement said.