/Jio Retracts Free Calling

Jio Retracts Free Calling

jio

In an unexpected decision, Reliance Jio mobile services are no longer completely free as the company will now charge 6 paise/ minute from its customers for outgoing calls to other network operators to recover the Interconnect Usage Charges (IUC).

Claiming to give free calling services, Mukesh Ambaniled Reliance Jio Infocomm entered the telecom industry on December 27, 2015, with a beta for partners and employees and became publicly available on September 5, 2016. In no time, it disrupted the telecom industry and ended the year with 6.4 per cent market share, as per data by the Telecom Regulatory Authority of India (TRAI). As of August 31, 2019, it is the largest mobile network operator inS India and the third-largest mobile network operator in the world with over 348.25 million subscribers.

Reliance Jio became the nation’s top telecom operator after free calls and cheap data lured millions of users and left rivals struggling under mounting debt. At the time of its launch, it had announced that all voice calls will be given for free along with affordable data rates.

But, we all now know that Reliance Jio has broken its promise and by making outgoing calls to other mobile operators no longer free.

jio digital life

What’s the controversy?

In an unexpected decision, the company has announced that the calls are not completely free and it would charge 6 paise/minute from its customers for outgoing calls to other network operators to recover the Interconnect Usage Charges (IUC) — the cost paid by one mobile telecom operator to another when its customers make outgoing mobile calls to the other operator’s customers.

Reliance Jio, in a statement, said that since voice calls on Jio network are free, highly charged 35-40 crore 2G users of rival networks end up giving missed calls to its users to trigger callbacks that have resulted in a payout of Rs 13,500 crore to Bharti Airtel and Vodafone Idea in last three years. So, to recover the losses created by the TRAI move, the company has decided to charge customers for every call they make to a rival’s network.

Customers will have to pay IUC charges until the TRAI brings the fee down to zero, which is expected to take place on January 1, 2020.

Who’s profit, whose loss?

TRAI has weighed the option of deferring date for scrapping IUC. It floated a fresh consultation paper to see if there is a need to revise the applicable date for scrapping IUC, given the continuing imbalance in inter-operator traffic. The paper also seeks to discuss what parameters should be looked at to decide on an alternate date, if any.

All major telcos, except Jio, want TRAI to delay scrapping of IUC. Airtel and Vodafone Idea, which are currently battling shrinking revenue, thanks to Jio’s cut-throat tariffs, have welcomed TRAI’s regulatory rethink.

“The existing dynamics push Jio to disadvantage as several outgoing calls from the Jio network are much higher. Hence, Jio was left with no option but to charge its customers with the same amount that it pays to other operators,”—Satyajit Sinha, Research Analyst, IoT, Security & Devices, Counterpoint.

Scrapping IUC or reducing would benefit an operator like Jio with more outgoing traffic than incoming calls. But if TRAI decides to postpone the date of scrapping IUC Bharti Airtel and Vodafone Idea would stand to gain as these telecom operators get more incoming calls than outgoing.

Airtel has backed the extension as it believes that traffic symmetry has not been achieved. Vodafone Idea, too, has said in its comments that there was a need to extend the applicable date to move to a zero-IUC regime and, wherever Bill and Keep exists, it is based on mutual agreement among operators when there is symmetry in traffic.

“We firmly recommend that the applicable date for Bill and Keep regime be moved by at least three years,” Airtel said in its comments on TRAI’s consultation paper. Under the Bill and Keep regime, operators do not pay any charge to each other for receiving calls on their network. Simply put, Bill and Keep means scrapping IUC.

“On September 19, 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, it had specifically mentioned that the TRAI 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,” Sunil Mittal-owned Bharti Airtel, reacted on Jio new announcement.

“The TRAI, in deems it necessary may revisit the scheme of termination charge applicable on wireless-to-wireless calls after one year from the implementation of the regulation,” it added.

Who to be blamed for this?

In its move to charge customers for the first time since its launch, Jio has put the entire blame on incumbents and the TRAI.

“While the incumbent operators reduced voice tariffs for their 4G customers, they continued to charge exorbitant tariffs to their 35-40 crore 2G customers, and increased the tariffs for voice calls to around Rs 1.50/ minute,” said the Mukesh Ambani-led telco.

“The price differential of free voice calls on Jio network and exorbitantly high tariffs on 2G networks causes the 35-40 crore 2G customers of Airtel and Vodafone Idea to give missed calls to Jio customers. Jio network receives 25 to 30 crore missed calls daily,” it said.

“This huge missed call phenomenon converts the incoming calls to Jio into outgoing calls from Jio to other operators. The 25 to 30 crore missed calls per day should have resulted in 65 to 75 crore minutes of incoming traffic to Jio. Instead, the call back made by the Jio customers results in 65 to 75 crore minutes of outgoing traffic,” it added.

Continuing its relentless attack on the regulator and old operators over the contentious IUC issue, Jio alleged that TRAI’s move is arbitrary, bad in law, unwarranted, and anti-poor.

trai

Jio has also alleged that review of call connect charges by TRAI sabotages the Prime Minister Narendra Modi’s vision for Digital India and will hit not only the regulator’s credibility but also investor confidence as the move protects vested interests of some old operators. Jio’s letter to the telecom operator In a letter to the telecom regulator, Jio has also alleged this is a fraudulent attempt by incumbent telecom operators for which they must be penalised.

The company has also alleged that Bharti Airtel, Vodafone Idea and BSNL to masquerade fixed landline numbers as mobile numbers to earn undue revenue through the interconnect usage charge.

“The incumbent operators have implemented a process under which various enterprises are offered mobile numbers as their customer care or helpline numbers,” Jio said in a letter, according to Live Mint.

“In these cases, the mobile number is used just as a virtual number for routing all such calls to call centres. We suspect that thousands of such numbers are operational in the market deployed by incumbent operators,” it added.

“Such illegal, fraudulent and cheating practice has resulted in millions of minutes originating on Jio network getting considered as mobile terminating minutes instead of wireline termination, not only causing huge loss in hundreds of crores to Jio and undue enrichment to incumbent operators but also to influence the authority on apparent traffic asymmetry between Jio and incumbents, which is the only reason cited by the authority to review IUC regulations,” Jio alleged.

How much IUC operators paid in 2018?

A report released by techARC based on the analysis of TRAI’s annual report 2018, estimates that the telecom operators paid a total of Rs 11,838 crore as IUC. Vodafone paid the highest, Rs 4,214 crore followed by Airtel Rs 3,411, Jio Rs 2,809 and others including BSNL/MTNL Rs 1,405 crores respectively. The average outgoing MoUs (Minutes of Usage) per annum was 312 minutes out of which 84.01 per cent of the usage terminates on another wireless network. The off-net wireless usage is 44.66 per cent of the total wireless minutes of usage.

jio phone

“While Jio has invested in an all IP network to support offering free voice calls, the disruption it entered with, incumbents are still not pure IP networks. VoLTE enablement is still an ongoing process for other operators, thus would require IUC to offset the infrastructure cost they bear on terminating a call,” said Faisal Kawoosa, Founder and Chief Analyst, techARC.

“While Jio has invested in an all IP network to support offering free voice calls, the disruption it entered with, incumbents are still not pure IP networks. VoLTE enablement is still an ongoing process for other operators, thus would require IUC to offset the infrastructure cost they bear on terminating a call,” said Faisal Kawoosa, Founder and Chief Analyst, techARC.

Consumer’s Reaction The decision of making outgoing calls chargeable by 6/paise to other networks did not go down well with customers. A lot of people expressed their views on Twitter, some showed anger and some supported the move by blaming TRAI.

“Let them charge whatever they want. We will just port our sim into another service provider,” a user tweeted.

However, the company said that all its customers will continue to enjoy the benefits of free voice calls to any number until their existing plan expires.

Now, as a Jio subscriber, you had to make the regular prepaid charge along with IUC minutes top-up plan and more. To ease up the confusion, Jio restructured its pricing for its prepaid plans recently but it wasn’t enough. Hence, Jio has introduced new All-In-One plans for its prepaid subscribers.

What’s next?

With so many ups and downs the telecom industry is facing today, the new controversy has added more fire in it. However, only the time will tell how these problems among the telecom operators will be resolved.

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Vivek writes on Technology and Innovation. Currently, the tech correspondent with MY MOBILE holds the distinction to have covered various national and international TECH SUMMITS. He was previously associated with IANS (Indo-Asian News Service) and holds a Master’s Degree in Journalism from Bhartiya Vidya Bhavan. Apart from writing, he is an avid traveller and does not share food!

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