Published: Thu, October 10, 2019
Tech | By

Reliance Jio does U-turn on call charges

Reliance Jio does U-turn on call charges

Reliance Jio today announced that it will start charging users 6 paise per minute for calls made to other telecom networks.

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Additionally, Jio, with Reliance Retail, will ensure priority allocation of the JioPhone to frequently called 2G users from Jio consumers. These calls between two networks are called mobile offnet calls.

"On 19th September, 2017, when Trai reduced the IUC from 14 paise to 6 paise and proposed a move towards Bill and Keep (zero IUC) with effect from January 1, 2020, they had specifically mentioned that the Authority shall keep a close watch on developments in the sector, particularly with respect to the adoption of new technologies and their impact on termination cost". The regulator had earlier aimed at ending the IUCregime by January, 2020.

Reliance Jio entered the Indian telecom market in 2015 with ultra low-priced plans. In the last three years, Jio had paid nearly ₹13,500 crore as NET/ IUC charges to the other operators.

All calls made to Jio customers, incoming calls, landline calls and VoIP calls will not face the IUC charge.

There are two key factors. However, TRAI is looking to extend the termination, thus, Jio is looking to now recover some charges to pay out its competitors until IUC is permanently terminated in the coming months. Another reason, according to Reliance Jio, is the asymmetry of calls between its network to rival networks.

Telecom operator Bharti Airtel has also alleged that Jio's decision to levy 6 paise per minute on voice calls to rival phone networks is geared to "force IUC to be brought down".

"Jio again assures its 35 crore customers that the 6 paise per minute charge on outgoing off-net mobile calls shall continue only till the time TRAI abolishes IUC, in line with its present regulation".

While the internet is clearly mourning, shares of Vodafone Idea and Bharti Airtel have surged like anything. It added that the telecom industry has been in a state of "deep financial stress" for the last three years with several operators having gone bankrupt and thousands of jobs having being lost. It also pointed out that India still has a massive 2G customers base and that 6 paise per minute is already lower than the real cost involved in completing a call. Second, with the growth of smaller sized operators, symmetry of traffic would ensue. Both of which it claims have not materialised. It also said that Reliance Jio's recent move to reduce ringing time could affect the revenues of other operators.

"Vodafone Idea operates basis the singular principle of pro-consumer and pro-choice".

Ambani had said at the company's 2016 annual general meeting (AGM) that he meant to keep all voice calls free.

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