Jio Alleges Airtel, Idea Made Excess Recovery of Rs 1.2 Lakh Crore in Interconnect Usage Charges

Reliance Jio has reportedly alleged that India’s top two telecom operators had made excess recovery of around Rs 1.2 lakh crore in Interconnection Usage Charges (IUC) over the actual cost of termination in the last five years, dismissing claims that they are incurring losses due to the reduction in call connect charges. It said that India’s leading telco, Bharti Airtel, made excess recovery of Rs 73,385 crore, while Idea Cellular, which is the third largest telco, made excess recovery of Rs 45,940 crore.

tower-random

The Mukesh Ambani-led telco, in its presentation to the telecom regulator, said that IUC rates have gone up from 10% of voice call charges in 2003 to 45% of call charges in 2017. It further added that voice traffic increased 7,200% during this period, debunking claims that incumbents were making losses due to the reduction of IUC charges.

Earlier this week, both Bharti Airtel and Idea Cellular sought to double the interconnect usage charge (IUC), to 30 paise per minute from the present 14 paise per minute to cover their costs. These telcos argued that if the IUC is scrapped, then they will lose the maximum revenue since they have the most number of subscribers and garner a major share of the termination charges as most calls end on their networks. They also backed the existing model of calling party pays (CPP) where a telco on whose network a call ends gets interconnect charge from the telco where the call originates.

According to media reports, incumbent telcos — Airtel, Vodafone and Idea which use circuit switch technology or legacy technology for all calls – claimed their cost of carrying an incoming call was 30 paise or more. However, Jio argued that incumbent telcos had made IUC as an artificial barrier with legacy technology. “There is practically nil cost in IP based networks – incumbent operators will launch VoLTE prior to the end of the year,” Jio said.

Jio also alleged that these telcos haven’t been making a new investment in voice networks for the last 7-8 years, and that cost of voice networks have been recovered manifold. It also termed IUC as an artificial barrier created by incumbent operators with legacy technology.

IUC is paid to an operator who handles the call. “Essentially the philosophy is that it should cover the cost. How do you compute the cost of handling it is the issue, as the cost is a function of multiple parameters, elements…everyone had their own grounds to make their arguments,” Trai chairman RS Sharma was quoted as saying.

Reported By

Leave a Reply

43 Comments on "Jio Alleges Airtel, Idea Made Excess Recovery of Rs 1.2 Lakh Crore in Interconnect Usage Charges"

 

Sort by:   newest | oldest
geek
July 20, 2017 7:32 pm 7:32 PM

Arm twisting from both sides ahead of the TRAI meet !

[…] has hit back at Reliance Jio’s claims at creating a monopoly in the Indian telecom market by proposing to scrap the interconnect usage charge (IUC), and moving to a ‘bill and keep’ regime. In a statement issued by Airtel moments back, […]

Gautam
July 20, 2017 2:11 pm 2:11 PM

Airtel 148 rs pack looks great

Screenshot_2017-07-20-14-05-10-107_com.myairtelapp.png
Kirti Khurana
July 21, 2017 12:51 am 12:51 AM

mention your circle? same costs 244 in Delhi

Telecom
July 20, 2017 9:38 pm 9:38 PM

These are only one time offer and for selected user. I previously recharged this kind of offer and got 1gb/per data which was 2G and 1gb total 4g for 28 days….just a big cheating….. Everything is hidden in t&c…..

Sandy
July 20, 2017 8:45 pm 8:45 PM

Its airtel to airtel only. You still.need to recharge with a rate cutter and talktime to call to other the 399 pack looks better. But be careful with the data it may or may not work in 2G/3G and could cost you separately.

Sagar
July 20, 2017 8:38 pm 8:38 PM

Please read t&c carefully. I had recharged with this pack got 1gb night data 250+50mb data and some 1gb other data. Better go for 399 pack. These avoid people are cheaters

Crazy
July 20, 2017 3:39 pm 3:39 PM

Yes it is but the sad part is these offers are only for selected customers.

DUANE
July 20, 2017 9:06 pm 9:06 PM

So what’s sad about that?

Kunal
July 21, 2017 10:38 am 10:38 AM
It is not fair when airtel is giving the pack to select few. Why differentiate between customers…..all are paying them ….trai should take action against airtel for this . I was getting all the offers of the select few packs because i had stopped using airtel data & calls since january 2017. I started using jio as primary sim for calling & data & shifted airtel for sim 2 slot for emergency call back up. Airtel started sending sms to put their sim in sim slot 1 & get all benefits of select few data packs of 4g. Mean while… Read more »
rahul
July 21, 2017 4:54 am 4:54 AM

He may not be getting that’s sad about it

Anyway I did not got that also

Kaushik
July 21, 2017 4:38 am 4:38 AM

It’s sad that airtel still doesn’t have guts to deliver one price one service scheme which some telcos have been doing for years including Vodafone, RCom and Jio.

wpDiscuz