Currently, it cost 14 percent per minute on all the incoming calls.
“By proposing a transition to the “Bill and Keep” regime with zero mobile termination charge (MTC), Reliance Jio wants to simply transfer its cost to Airtel and other operators”.
Any change in IUC has a direct impact on mobile call tariffs as the charge is taken into account while setting telecom tariffs. There is very less cost of carrying calls on 4G network, but still incumbent operators are making people in rural areas use 2G network.
Furthermore, Airtel called the Reliance Jio’s claims as “are not only false but laughable”.
Reliance Jio is seeking an end to call termination charges merely to transfer its own costs, now Rs20,000 crore a year, to other operators, Airtel said in a statement, adding these costs will only increase in the future.
Incumbents have also demanded to increase the IUC rates to 28- 35 paise per minute from the present level of 14 paise a minute. In fact, with the tsunami of calls originating from Reliance Jio’s network, Airtel loses 21 paise for every minute that is carried on its network. This is Mobile Termination Charge (MTC) regime.
Reliance Jio has sought an end to interconnection user charges (IUC), or call termination charges, even as established airlines have demanded doubling of the fee, opening a new front in the ongoing war with the newcomer and entrenched interests.
Trai Chairman RS Sharma confirmed that the operators had suggested an increase in the IUC, but did not name any particular operator.
“Normally, we complete work on a consultation paper in six months but for this consultation we are about to celebrate anniversary”, Sharma said.
“Going by the growth rate, if the subscriber base of a new operator goes up to 400 million, it will push the cost burden of Rs 2 lakh crore on the industry”, the Airtel representative said.
“The question of haste is do with ability of operators to review the model which is fundamental and foundational to determining whether it (IUC) is 2 paise, half paise or 36 paise”. They also are reported to have presented their cost structures to press for a hike in IUC to at least 30 paise, reports quoting sources present at the meeting said. How do you come to conclusion what that is? “This process was started nearly a year back”, he said adding that the Authority will not hold anymore consultations on IUC. However, due to objection raised by COAI the app service has been put on hold.