Reliance Jio will now charge its customers 6 paise per minute for mobile voice calls made to other operators to recover the interconnect usage charge (IUC) of, The Economic Times reported. These charges will be effective from today only until the Telecom Regulatory Authority of India reduces these IUC charges to zero.

What does this mean for Jio customers? Jio customers making off-net voice calls to other operators will be charged the current IUC rate of 6 paise/minute. All Jio customers who wish to make calls to other operators’ numbers will have to buy additional top-up vouchers of Rs 10, Rs 20, Rs 50 and Rs 100. However, the customers will be compensated with equivalent data for the value of voucher and post-paid customers will be billed at 6 paise per minute for off-net outgoing calls with an increase in free data entitlement.

The charge will not be applicable to:

  • All Jio-Jio calls
  • All incoming calls
  • Jio-to-landline calls
  • Call made using WhatsApp or Face Time and similar platforms

What is Interconnect Usage Charge? It is the price paid by one mobile telecom operator to another when its customers make outgoing mobile calls to the other operator’s customers. These charges are fixed by TRAI.

Do Airtel and Vodafone charge IUC from customers? No. However, all telecom operators pay IUC charges to other operators for outgoing calls and similarly, they receive the amount from other operators for incoming calls.

Why did this happen? The move comes after the TRAI released a consultation paper in September, seeking industry views on whether the IUC charge removal should be deferred from the current January 1, 2020 deadline because of high continued inter-operator traffic asymmetry. It is worth noting that if the traffic flow among operators is symmetrical, it will not have a negative impact on any operator as it is simply a charge paid from one operator to another. The paper also asked what parameters should be looked at to decide on an alternate date, if any, for the IUC charge removal.

Other operators respond to Jio’s move:

  • Bharti Airtel said this move is geared to “force IUC to be brought down”. It also noted that the ongoing review of call connects charges or IUC is consistent with TRAI’s previously-stated intent, Live Mint reported. Airtel has said that TRAI had made it clear that the issue will be revisited based on factors such as the adoption of new technologies (their impact on termination cost) and traffic pattern. Airtel further noted that the telecom industry has been in a state of deep financial stress for the last three years with several operators having gone bankrupt.
  • Vodafone Idea said Jio’s call to recover IUC money by charging customers was done in “haste” and was diverting attention from the sector’s poor health, as per The Economic Times. It added that this move does not bring out the fact that “interconnect is a settlement between operators and the consumer price matter”.

TRAI issued Telecommunication Interconnection Usage Charges Regulation (2017): In September 2017, TRAI did a comprehensive review of the IUC regime and issued the Telecommunication Interconnection Usage Charges Regulations, 2017. Based on the regulations, IUC was cut from 14 paise/min to 6 paise/ minute from October 2017, with the aim of making this charge zero from January 1, 2020. The then incumbent players such as Bharti Airtel, Vodafone, and Idea were not happy with the regulations and said that Jio’s free voice call creates an off-net outgoing imbalance.