On account of taking a hit of Rs 13,500 crore due to network connection charges, or interconnect usage charges (IUC), Reliance Jio on Wednesday said it will charge customers 6 paise per minute for voice calls made to rival networks till IUC charges are eliminated.
This is the first time that Jio users will pay for voice calls which have been free so far since September 2016.
After ringtone time reductions, this move is going to set off the new tariff war on voice calls which could see rival telecom operators like Airtel and Vodafone taking some steps to recover costs.
Jio’s decision to charge voice calls comes after the Telecom Regulatory Authority of India (Trai) floated a consultation paper to review whether the regime timeline needs to be extended.
Trai had, in 2017, slashed the IUC to 6 paise per minute from 14 paise, and had said that the regime would end by January 2020.
“The consultation paper has created regulatory uncertainty and therefore Jio has been compelled, most reluctantly and unavoidably, to recover this regulatory charge of 6 paise per minute for all off-net mobile voice calls so long as IUC charges exist,” the Jio statement said.
“So, for all recharges done by Jio customers starting today, calls made to other mobile operators will be charged at the prevailing IUC rate of 6 paise per minute through IUC top-up vouchers till such time that Trai moves to zero termination charge regime.
“Presently, this date is January 1, 2020. We are hopeful that the IUC charge will be done away with as per the current regulation and that this temporary charge will come to an end by December 31, 2019 and consumers will not have to pay this charge thereafter.”
“In the meanwhile, consumers can continue to enjoy the additional data entitlement in lieu of the IUC top-up vouchers so that there is no effective tariff increase till 31st December 31, 2019”, Jio said.
While making the customers pay for voice calls made to any rival network, Jio said it will compensate them by giving free data of equal value.
Currently, Jio charges only for data, and voice calls to anywhere in the country and to any network are free. On its own network, there is no 6 paise per minute charge on – all Jio to Jio calls, all incoming calls, Jio to landline calls and calls made using WhatsApp or FaceTime and similar platforms.
Since voice calls on the Jio network are free, the company said it had to bear the Rs 13,500 crore payment made to rivals such as Bharti Airtel and Vodafone Idea.
The new rules will apply to all recharges done by Jio customers starting Wednesday.
“Jio will provide additional data entitlement of equivalent value based on IUC top-up voucher consumption. This will ensure no increase in tariff for customers,” Jio said.
The company also said it has, in the last three years, paid other operators like Airtel and Vodafone-Idea nearly Rs 13,500 crore as net IUC charges.