Telecom operators are planning to move the court seeking a stay on the new interconnection usage charges (IUC) fixed by telecom regulator at 6 paise/minute.
Bharti Airtel and Vodafone have expressed disappointment over the drastic cut in IUC announced on Tuesday, saying the move will benefit only one operator and worsen the financial health of the stressed industry.
“As part of an industry, which continues to be a critical driving force behind the economic growth in the country, we are genuinely dismayed by this decision,” said Airtel.
Asked when will telecom players move court against Trai move, Cellular Operators Association of India (COAI) director general Rajan Mathews said, “It will be done soon as the stay has to come before the implementation date of October 1.”
“The suggested IUC rate, which has been arrived at in a completely non-transparent fashion, benefits only one operator which enjoys a huge traffic asymmetry in its favour,” he said. The industry is facing severe financial stress and the cut in the interconnection usage charges (IUC) will “further worsen” the situation.
Mathews said members will also seek clarity from Trai on the model, methods assumptions and cost parameters used to arrive at their number.
Also, any indication this will drive down tariffs is misguided as IUC has no correlation to market prices, he said.
Vodafone also termed the Trai’s decision as “retrograde regulatory measure”. The move will significantly benefit new entrant alone and would adversely affect the rest of the industry.
Currently, IUC has been fixed at 14 paise per minute for domestic mobile calls.
A Reliance Jio spokesperson said, “The implementation of Bill & Keep regime will help in making services more affordable for Indian users. It should have been implemented in 2014 as envisaged in the 2011 report submitted by Trai to the Supreme Court, it said.
“There is no question of any advantage from the new IUC regulation to Jio as it has already passed on all the benefits to customers. We deny any benefits to Jio. At a time when the world is moving towards IP-based technologies, cost of voice has come down to a fraction of a paisa and the customers should enjoy this advantage.” it said.
References to financial stress in the industry or the need for IUC to promote rural coverage again shows the attitude of the incumbent operators wherein IUC is being treated as a subsidy that the Indian customers must pay to sustain these operators financially, it said.
Reliance Communications welcomed the move. “We welcome the reduction in IUC to 6 paise by Trai. We also welcome the B&K model, to be effective from January 2020. The IUC cut has already been delayed by 3 years. With voice calls becoming free, Trai’s move will provide a level playing field,” it said in a statement.
VENTING IRE
- COAI will seek clarity on the methods used to arrive at their number
- Any indication the cut will drive down tariffs is misguided, it said
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