The Indian telecom regulator came out with a regulation where it has more than halved the call termination charges from mobile to mobile to 6 paise per minute effective from October 1, 2017. Also Read - Indian mobile gaming market to shoot up to at least $5 billion by 2025: ReportAlso Read - India's first virtual science lab launched for students: Here's what the govt wants to acheive with it
“For mobile to mobile, termination charge has been reduced from 14 paise per minute to 6 paise per minute with effect from October 1, 2017,” the Telecom Regulatory Authority of India (TRAI) said in a statement. It said: “Such a revision in the mobile termination charge is in line with the international trends.”
Domestic termination charges are the charges payable by a telecom service provider (TSP) whose subscriber originates the call, to the TSP in whose network the call terminates. It further added: “From January 1, 2020, onwards the termination charge for all types of domestic calls shall be zero.” It said for other types of calls (such as wire-line to mobile, wire-line to wire-line and wire-line to mobile) the termination charge would continue to remain zero. ALSO READ: India to cross 50 crore Made in India mobile phones by 2020: Official
The TRAI said: “Further, the cost of termination of calls will drastically come down over a period of two years and very small residual value, if any, can be absorbed by the TSPs in their tariff offerings. As a result, the Authority prescribes a Bill and Keep regime for the wireless to wireless calls effective from January 1, 2020.” The prevailing Interconnection Usage Charges (IUC) Regulation was notified on February 23, 2015, and came into effect on March 1, 2015.
This regulation of TRAI will give a big jolt to the incumbent TSPs like Bharti Airtel, Vodafone India and Idea Cellular who said a lesser IUC regime will be detrimental to the industry. However, a new entrant in the industry Reliance Jio has always demanded zero termination charges. Earlier Vodafone Group CEO Vittorio Colao had urged the Indian government not to reduce mobile termination charges (MTC) further.
In a letter dated August 22, Colao said: “On mobile termination charges, we are seriously alarmed to see reports that the Regulator is considering a reduction in MTC at a time when the industry is facing such immense hardships. Any reduction in MTC risks large-scale site shut-down of already unprofitable sites in rural India and which would greatly diminish the population coverage of mobile telephony.” ALSO READ: Xiaomi outgrew rivals in Q2 2017; now back in the top-5 smartphone vendors club
Interconnection allows subscribers, services, and networks of one service provider to be accessed by subscribers, services, and networks of the other service providers. If networks are efficiently interconnected, subscribers of one network are able to seamlessly communicate with those of another network or access the services offered by other networks. The TRAI said it would keep a close watch on the developments in the sector particularly with respect to the adoption of new technologies and their impact on termination costs.
“The Authority, if it deems it necessary, may revisit the aforementioned scheme for termination charge applicable on wireless to wires calls after one year from the date of implementation of the regulation”,” it added.