Telecom regulator Trai is not considering to reduce the international termination rates (ITR). Trai conducted a workshop on October 16 to discuss the ITR and in the same workshop, Jio asked the Trai to set same rates for both domestic and international termination rates.
However, according to a new report from Economic Times, Trai is unlikely to reduce the international termination rates (ITR), which is a charge paid by telecom operators to foreign networks that receive calls. The report says that the method of calculating costs varies in domestic and international cases.
Reliance Jio asked Trai to set same rates for both international and domestic calls, but incumbent telecom operators- Airtel, Vodafone and Idea Cellular asked for a price hike. COAI also asked for a steep price hike in IUC and requested Trai to set ITR at Rs. 3.50/min.
Currently, foreign operators pay local operators 53 paise per minute, but Jio wants it to be decreased to 6 paise per minute, same as domestic rate. However, incumbent operators wanted the same to be increased between Rs. 1 per minute and Rs. 3.50 per minute.
Trai is broadly clear that the methodology used to calculate domestic and international call rates differ. “We are still trying to figure out which model will work here,” said a Trai official to ET.
“At the heart of the method used to determine IUC is the principle that one operator should not gain at the cost of a competitor. IUC is between two operators and the charges between them should be the “minimum avoidable charges,” the official said. “If we apply that in international calls, then it’s a straight 6 paise. But here, you are dealing with multiple foreign partners,” says the ET report.
“It’s multilateral. And there are other players in between also, such as international long-distance operators and national long-distance operators. So, it’s not a direct peer-to-peer transaction. So, the relationship is not symmetric here. Therefore, the philosophy of 6 paise may not be appropriate or optimal here,” the official added
Trai has recently reduced the domestic IUC from 14 paise per minute to 6 paise per minute, and it will be eventually scrapped in January 2020.