The Indian Telecommunications Regulatory Authority (TRAI) is about to make a critical intervention in the cost of mobile call rates. According to the cover story in The Times of India, Trai is very close to reducing the use charges of interconnection (IUC) from the current 14 paise per minute to less than 10 paise.
This is a positive step, which has long been expected because Trai demonstrate that, despite having the mandate to lead the telecommunications market in a way that ensures the health of operators, its main commitment is one because much larger : The interest of consumers.
IUC is the responsibility of telecom operators to pay each other for voice calls to all networks. For example, let’s take the case of a user calling Airtel user Idea. Here Airtel uses network facilities idea to make the call, so it will pay some costs (IUC) to Idea.
The quantum of the UIC is determined by Trai, now it is 14 paise per minute. That is to say that Airtel user pay 30 rupees per minute to Airtel for the call. Airtel goes from 14 paise to Idea. The opposite is true when a user calls an Airtel Idea users, while Idea pay IUC Airtel.
The essential fact is hidden in the rates of voice calls that you pay your operator is: you pay 30 rupees per minute voice call to your carrier. Your operator pays 14 countries, or 45 percent, for the operator whose network terminates the call.
In other words, almost half of their charges per call is IUC, the burden that mobile operators will have to pay (in the pocket, that is). What this means is that your call rates can drop by half if IUC is zero.
Over the years, Trai has systematically reduced CUC, but last October, the big question is presented in the industry working paper. He wondered if the IUC should be zero if the industry was moving to what is called the Bill System and (BAK) Hold.
BAK means exactly what it says; Operators charge other operators but do not actually collect IUC. Under BAK, these fees do not collect or pay as they are supposed to be canceled due to the symmetry of call (number of calls generated and ending in each network, according to this story on the Financial Express).
The historical telecommunications operators – Bharti Airtel, Idea and Vodafone – who oppose the reduction of the IUC, much less the re-establishment and transition to BAK. In fact, they are part of the telecommunications that actually claimed, increased IUC 14 paise to 35 paise per minute.
All responded to the consultation document Trai that the current rate of 14 paise is below cost and there is no reason why the CIU is zero. The three also said in various forums that the cost of transferring incoming calls in their respective networks is 30 rupees per minute, Vodafone said that later registered the license fee that each telecommunications company must pay this cost is 34 paise, a report In the Times of India said.