As a result of uncertainty around regulatory policy changes for interconnect charges, Jio says it is compelled to recover mobile termination charges for non-Jio mobile voice calls.
Background: Since 2011, the Telecom Regulatory Authority of India (TRAI) affirmed its stance that the interconnect usage charges (IUC) should be brought down to zero. After a comprehensive review of the IUC regime, the TRAI confirmed in 2017 that IUC for mobile calls will be zero from 1 January 2020. On 18 September 2019, the TRAI opened a new consultation on whether it is still appropriate to move to a zero charge based on technological developments that were expected to take place (essentially the move from circuit to packet switched networks). Jio says this reopening of the issue has created a situation of uncertainty, and one in which they feel they can no longer absorb the cost of terminating calls on competitors networks.
What does this mean for Jio’s subscribers? Since 10 October 2019, all calls to non Jio mobile numbers will be charged at 6 paise/minute, to fund this, subscribers will need to purchase a top-up voucher starting at Rs 10, that can be used to make such non-Jio calls. To compensate customers for the cost of these additional top-ups, Jio is offering customers an additional 1GB of data for every 10-rupee spent. Jio says the recovery of interconnect charges will continue until the IUC is made zero by TRAI and that all Jio-to-Jio calls continue to be free of charge.
Why does this matter? Jio currently pays out more than it receives in IUC, which is one reason the operator is keen for the TRAI to stick to the commitment to reduce the charge to zero. Introducing top-ups and making it clear it was because of the TRAI seems like it was intended to shift the focus and blame onto the regulator, however it has not gone down well with customers, with many taking to social media to express frustration and even advocate a boycott of the network. At risk is the reputation of a brand that has been very pro-consumer, and a considerable disruptor.
