Insta
No Connect Between IUC, Financial Stress On Telcos: TRAI
Swarajya Staff
Sep 29, 2017, 04:24 PM | Updated 04:24 PM IST
Save & read from anywhere!
Bookmark stories for easy access on any device or the Swarajya app.
Telecom Regulatory Authority of India today rejected the argument that reduction in mobile call connection rates has any linkage with financial stress in the telecom sector, saying the charges are not meant for making a profit.
“To my understanding, there is no connection between stress in the telecom sector and IUC rates because rates cannot be profit vertical for any company. You get compensated for whatever work you do. Whether you are handling one call or 10 calls, you are not being paid less or being paid more. You don’t make a loss or profit,” Sharma said.
He was responding to a query over criticism over IUC reduction at the India Mobile Congress by Idea Cellular Managing Director and CEO Himanshu Kapania. Mobile companies currently charge 14 paise a minute for allowing a domestic call from a rival operator to terminate on their network. This charge, called Interconnection Usage Charge or IUC, will be 6 paise per minute from 1 October 2017. Kapania had said recent market developments have drastically altered industry dynamics, resulting in the sector passing through a phase of severe “financial and mental stress”.
Terming the regulatory and financial issues being faced by the sector as the “elephant in the room that no one is talking about”, Kapania flagged the recent cut in IUC, firm spectrum prices and high levies like licence fee and GST as big constraints. He said that the reduction in call connect charges will further “deplete” the industry of investible funds. Sharma also rejected the allegation of giving preference to only Internet protocol (IP) based networks. “We are essentially nudging the network to go to IP which is much more efficient,” Sharma said. PTI
Save & read from anywhere!
Bookmark stories for easy access on any device or the Swarajya app.
Introducing ElectionsHQ + 50 Ground Reports Project
The 2024 elections might seem easy to guess, but there are some important questions that shouldn't be missed.
Do freebies still sway voters? Do people prioritise infrastructure when voting? How will Punjab vote?
The answers to these questions provide great insights into where we, as a country, are headed in the years to come.
Swarajya is starting a project with an aim to do 50 solid ground stories and a smart commentary service on WhatsApp, a one-of-a-kind. We'd love your support during this election season.
Click below to contribute.