Jio welcomes TRAI’s new IUC as top telecoms queue for “ICU”

Mukesh Ambani and familyBillionaire Mukesh Ambani promoted Reliance Jio, the all-India 4G operator with $20 billion plus investment, said TRAI’s 57 percent cut in interconnection charges and zero charges from 2020 will create affordable tariffs to mobile customers.

India has more than one billion mobile phone customers. While Airtel is the largest telecom operator in terms of subscribers and revenue, Reliance Jio has emerged as the top 4G operator by adding 130 million 4G subscribers in nearly 12 months.

Earlier today, Vodafone and Bharti Airtel said the significant cut in mobile termination charges will further derail the industry which is already hit by huge debt, declining EBITDA, low investment in Capex and slow revenue growth.

Jio said it is committed to implementing the most efficient telecommunications network in India and passing on the benefits of technology to Indian customers. Jio offers free voice services to all its customers backed by a superior technology and has helped make India the world’s largest mobile data consuming country within one year of commencement of services.
Mukesh Ambani's children“Implementation of Bill & Keep regime will help in making mobile services more affordable for Indian wireless customers. It should have been implemented in 2014 as envisaged in the 2011 Report submitted by TRAI to the Supreme Court and will be six years too late,” said Reliance Jio in a statement.

Jio is the first Indian telecom operator to commit to offer free voice services to its customers in a bid to add data customers to its 4G network.

Though Airtel, Vodafone and Idea Cellular reduced voice tariffs by offering “unlimited packages”, they could not meet competition from Reliance Jio.

Fitch Ratings today said Reliance Jio will gain from an additional $500 million to $600 million revenue via the new interconnection regime. At the same time, EBITDA of Airtel, Idea and Vodafone will dip due to the 57 percent reduction in IUC. Revenue of top telecom operators will also hit by the new interconnection regime.

“There is no question of any advantage from the new IUC regulation to Jio as it has already passed on all the benefits to customers. We deny any benefits to Jio. At a time when the world is moving towards IP-based technologies, cost of voice has come down to a fraction of a paisa and the customers should enjoy this advantage,” said Reliance Jio.

The Delhi High Court earlier today dismissed the petition of one of the incumbent operators while pronouncing that the appeal fails to show any violation of Section 11 (4) of the TRAI Act, 1997 (principles of transparency).

Reliance Jio said it is appalling that the incumbent operators have still gone ahead and made untrue and baseless allegations against the process for determination of IUC or the telecom regulator. The incumbent operators have opposed all the IUC regulations over the last 8 years. But they did not provide the benefits of lower IUC to customers.

Jio said references to financial stress in the industry or the need for IUC to promote rural coverage again shows the attitude of the incumbent operators wherein IUC is being treated as a subsidy that the Indian customers must pay to sustain these operators financially.

Reliance Jio said the high cost IUC regime has caused financial stress for the smaller and new operators.