Trai May Not Scrap IUC for Another 2 Years: What it Means for Jio Customers?

It is likely that Trai might make the shift to a zero-IUC regime two years later meaning that Reliance Jio customers could be stuck with the 6 paise per minute charge for longer.

Highlights
  • Previously, Trai was to shift to a zero-IUC regime by the end of 2019.
  • Trai is likely to hold back on any new decisions because of the telecom industry's financial situation,

There is a full-blown battle underway in the telecom sector regarding the Interconnect Usage Charges. The feud between the telecom operators, which was between the companies until now has now extended to the subscribers as well since Reliance Jio has announced that for every outgoing call to other networks, it is going to charge its customers 6 paise per minute. This announcement has taken the telecom industry by storm and left a big divide between the telecom operators. However, there is more to the story. Until now, it was believed that the Telecom Regulatory Authority of India (Trai) was planning an approach towards zero-IUC which means that the telecom operators would not have to pay any IUC on call termination on their networks. But, now it seems that with the latest developments in the industry, the timeline for this to happen has been postponed and now the telecom regulator will make the plunge to zero IUC a few years later.

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Trai Could Postpone Shift to Zero-IUC for Two Years

As per a new report by Financial Express on the topic, Trai is likely to continue charging the 6 paise per minute IUC for two more years with the period beginning on January 2020. Previously, the talks had pointed towards the transition to zero IUC by this period. But, it seems that given the current financially strenuous situation of the telecom industry, Trai is going to stick with the current IUC charges. As per Trai, the telecom industry currently remains under financially tensed situations, and it won’t be good for the industry to bear one more disruption. Given these situations, Trai has decided to stick with the current IUC charges of 6 paise per minute. The change in IUC regulations or the lack thereof were at one time non-affective for the subscribers, but with Reliance Jio’s new change, these rules now have deeper implications for the customers.

Considering the case that the IUC charges were to go bust after the year-end like planned before, then the Reliance Jio customers would have been reverted to the previous plans. This would have meant that after a few months of paying 6 paise per minute charge, the customers would have come back to enjoy free unlimited calls like it was the case before. However, with Trai’s new plans hatching in the telecom industry, the picture might not be that rosy. If Trai plans on keeping up with the current IUC rates for two more years, then it means that the subscribers of Reliance Jio would also have to keep paying 6 paise per minute for all the outgoing calls that they make to other networks.

What Does it Entail for Reliance Jio Customers?

Now as per the report on the matter, all recharges done by Jio customers starting today, calls made to other mobile operators will be charged at the prevailing IUC rate of 6 paise per minute through IUC top-up vouchers till such time that TRAI moves to Zero termination charge regime. Presently, this date is 1st January 2020 although there has been no official word from Trai regarding the extension of the date when there will be a shift to the zero-IUC regime.

It is also worth noting that after Reliance Jio’s move, Vodafone Idea Chairman Kumar Mangalam Birla, Sunil Bharti Mittal and other notable execs have met with the telecom minister, Ravi Shankar Prasad seeking some action on the tariff front. The telecom minister, on his part, had written to the government seeking some relief. The DoT is also likely to give some relief to the telcos with a two-year moratorium on payment of deferred spectrum instalment or extending the payment period from the current 16 years by another two years.

It’s worth noting that the last time that Trai had slashed the IUC charges was in September 2017 when it had brought down the IUC charges from 14 paise per minute to 6 paise per minute. The vision that time was to make a gradual shift to a zero-IUC regime.

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Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

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