TRAI announces drop in Interconnection Usage Charge (IUC)

19 September, 2017, 22:42 | Author: Marjorie Miles
  • TRAI Slashes Call Connect Charge to 6 Paise Per Minute

Mobile companies now charge 14 paise a minute for allowing a domestic call from a rival operator to terminate on their network.

The new rate will be applicable from October 1, 2017, and will be completely eliminated from January 1, 2020. While the top operators had pitched for doubling the MTC "to recover their cost", the newer rival had suggested zero charges and shifting to the bill-and-keep regime, under which operators bill their own subscribers for outgoing calls and retain revenue received.

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This decision by the TRAI runs contrary to the demands made by several operators, including Bharti Airtel, which wanted the termination rate to be raised instead. Jio is expected to benefit from these recent cut in charges as it will bring down its overall expenditure, reports said. "For other types of calls (such as wire-line to mobile, wire-line to wireline and wire-line to mobile) the termination charge would continue to remain zero.From 1st January, 2020 onwards the termination charge for all types of domestic calls shall be zero", TRAI said in a statement.

TRAI fixes IUC that has several components. Only Reliance Jio was in favor of reducing the domestic termination charges.

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Mobile Termination Charges (MTC), now 14 paise, are payable by the operator whose subscriber makes a call to the operator whose subscriber receives the call, and directly impact the tariff.

This come as a big blow to both Airtel, Vodafone and Idea cellular.

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