 "Trai extends date for receiving comments on interconnect charges")
The Telecom Regulatory Authority of India (Trai) has extended the last date for receiving comments on its consultation paper on interconnect usage charges (IUC), from September 5 to September 26.
The discussion paper, which came out on August 5, has created a flutter in the telecom sector with GSM operators’ body Cellular Operators’ Authority of India (COAI) even calling Trai biased against incumbent players.
The interconnect charges are paid by a telecom operator to another when the former’s call terminates on the latter’s network. Currently, the charges are 14 paise per minute, but Trai has sought comments from stakeholders on reviewing these charges. COAI had said the current interconnect regime was implemented by the regulator in March 2015 and it was clearly stated by Trai itself in 2015 that the next review would take place in 2017-18.
“It is, therefore, surprising to see the urgency displayed by Trai in this matter, with the consultation process initiated at such an early date and despite the fact that the matter is sub-judice in various courts of law. It appears the exercise is aimed at hurting the financial and operational viability of existing operators,” COAI has said. According to estimates, interconnect charges contribute around Rs 20,000 crore to the revenues of existing telcos and, if scrapped, the top three operators are likely to lose Rs 5,000 crore each in a year.
While incumbents have raised the red flag against the paper, Reliance Jio is in favour of scrapping the charges, as it would bring down costs of voice calls further and, in turn, benefit consumers.
Jio has already announced that all the voice calls on its network will be free.
The discussion paper, which came out on August 5, has created a flutter in the telecom sector with GSM operators’ body Cellular Operators’ Authority of India (COAI) even calling Trai biased against incumbent players.
The interconnect charges are paid by a telecom operator to another when the former’s call terminates on the latter’s network. Currently, the charges are 14 paise per minute, but Trai has sought comments from stakeholders on reviewing these charges. COAI had said the current interconnect regime was implemented by the regulator in March 2015 and it was clearly stated by Trai itself in 2015 that the next review would take place in 2017-18.
“It is, therefore, surprising to see the urgency displayed by Trai in this matter, with the consultation process initiated at such an early date and despite the fact that the matter is sub-judice in various courts of law. It appears the exercise is aimed at hurting the financial and operational viability of existing operators,” COAI has said. According to estimates, interconnect charges contribute around Rs 20,000 crore to the revenues of existing telcos and, if scrapped, the top three operators are likely to lose Rs 5,000 crore each in a year.
While incumbents have raised the red flag against the paper, Reliance Jio is in favour of scrapping the charges, as it would bring down costs of voice calls further and, in turn, benefit consumers.
Jio has already announced that all the voice calls on its network will be free.