The telecom market moves to a new regime from Friday with the interconnect usage charge (IUC) becoming zero. This indicates the operators will no longer have to spend the termination charge of 6 paise per minute to every single other.
The new regime, exactly where zero termination price is payable, is identified as bill and preserve. A termination charge was paid to the operator on whose network the contact terminated by the originating network.
With the new regime kicking in from Friday, Reliance Jio, the only operator which charged its shoppers for termination of off-net calls (calls produced to yet another network like Bharti Airtel or Vodafone Idea), stated it would no longer levy this charge.
While levying a termination charge for off-net calls in October 2019, Jio had stated it would abolish it the day IUC becomes zero. The charge was in-constructed into its tariffs by way of leading-up vouchers of various denominations and was pass by means of in nature.
“As per directions of Trai, bill and keep regime is being implemented in the country from January 1, 2021, thereby ending interconnect usage charges for all domestic voice calls. Honouring its commitment to revert off-net domestic voice-call charges to zero, as soon as IUC charges are abolished, Jio will once again make all off-net domestic voice calls free, starting January 1, 2021. On-net domestic voice calls have always been free on the Jio network,” Jio stated in a statement on Thursday.
The improvement would be income-neutral for all operators as largely there’s a symmetry by now involving incoming calls to their networks and the outgoing to other networks. Till about a year ago, even though there was a symmetry involving incoming and outgoing calls involving the networks of Bharti Airtel and Vodafone Idea, in case of Jio, the quantity of outgoing calls was bigger than incoming, and as a result, it was a net payer of IUC rather than net receiver.
In October 2019, even though announcing it would charge for off-net calls, Jio had stated because its launch in September 2016, it had to bear `13,500-crore payment to Bharti Airtel and Vodafone Idea as termination charges.
While reviewing the termination charge in 2019, which it does just about every two years, the Telecom Regulatory Authority of India (Trai) had retained the regime of payment for yet another year — January 1, 2020, till December 31, 2020 — and stated from January 1, 2021, it would develop into zero.
Trai had then stated it has to preserve the interests of 2G/3G subscribers in thoughts. It had additional stated website traffic imbalance involving an only 4G operator (Reliance Jio) and other operators had decreased from the peak of roughly 60 billion minutes per month in December 2017 to 40 billion minutes per month in June 2019. It had earlier anticipated this imbalance to be corrected by 2020 but because it did not come about the regulator extended the price by a year.