Trai Zero IUC Regime Will Now Come into Effect in 2021, Companies Will Pay IUC For One More Year

The IUC is something that the companies bill and keep and then pay to each other for carrying calls from one network to another

By December 17th, 2019 AT 6:56 PM
Highlights
  • The IUC is currently set at 6 paise per minute
  • The shift to new regime will bring this IUC down to zero
  • Reliance Jio subscribers might have to wait a year for IUC charges to go away

The debate on the Interconnect Usage Charges (IUC) has been a long-standing one in the industry now. This debate has also been a reason for the tussle between the telecom operators, with the incumbents standing on one side and the Mukesh Ambani led telecom operator on the other side. It is worth noting that until now, the Telecom Regulatory Authority of India (Trai) has said that it would transition to the zero IUC regime by the end of this year. This was the move which was expected to happen. The interconnect usage charges are currently capped at 6 paise per minute for the telecom operators as per the current rules in the industry. This was the reason why Mukesh Ambani led telecom operator started charging this amount from the subscribers. Now there has been a debate going on about when the transition to the zero IUC regime would be made. While most expected it to happen by the end of this year, there were also speculations that it would be postponed by two years. However, now it seems that Trai has found out the middle ground to this issue and postponed the transition to the zero IUC regime by a year.

trai-zero-iuc-regime-postpone

Postponement of Zero IUC Regime

As per a new press release from the telecom regulator, the transition to the zero IUC regime has been postponed by a year. This means that until the end of 2020, the telecom operators will have to keep paying 6 paise per minute to each other for all the calls that they carry. This will be the case until December 31, 2020. After that starting 2021, the zero IUC regime would come into effect, where all the telecom operators will not have to pay any amount to carry the calls of other telecom operators. Trai noted in its release, “From 1st January, 2021 onwards the termination charge for wireless to wireless domestic calls shall be zero.”

Trai Concludes Consultation Paper and Discussion

It is worth noting that Trai had issued a consultation paper on the matter on September 18, 2019, on the matter of IUC regime and when the transition to the zero IUC regime should happen. The telecom regulator had invited comments from the stakeholders and the counter comments as well on this issue. Later on, the regulator had also held an Open House discussion on November 15, 2019, in New Delhi to discuss the issue with all the other stakeholders. Now as per all the discussions and comments, the shift to zero IUC regime will happen on January 1, 2021, and not by the end of the current year.

Reliance Jio Subscribers Might Have to Keep Paying Extra

IUC is the charge that the telecom operators have to pay to each other every month for the calls that they carry. For example, if you call from a Reliance Jio number to a Bharti Airtel number, then Reliance Jio has to pay the 6 paise per minute cost to Bharti Airtel to carry your call. This is the reason why Reliance Jio has started charging this amount from the subscribers because being the biggest telecom operator, most of the outgoing calls are happening from Reliance Jio numbers. The postponement of the zero IUC regime also means that Reliance Jio subscribers might have to continue paying the IUC charges on their prepaid plans until the end of next year. Currently, Reliance Jio is offering various IUC plans to its customers. If the IUC had been done away with by the end of this year, then the Reliance Jio subscribers would have also had some relief.

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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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