Editorial – November 2017

Since long, Trai has been fixing the international termination call (ITC) charges at much higher level than its cost. But, it never ensured that its benefit is passed on to the domestic consumers in the form of lower domestic termination charges (DTC) for domestic calls. Presently, ITC is charged at 53 paisa per minute while the actual cost is 6 paisa per minute which has been fixed by Trai.

It is now emerging that since 2009, Rs 19,000 crore worth of extra payment has been made to the access service providers on account of higher ITC. About 60 per cent of this has gone to three private operators – Bharti Airtel, Vodafone & Idea.

However, Trai’s chairman RS Sharma has initiated a review of ITC. In August last year it issued a consultation paper. Trai has received responses from many stakeholders. Bharti Airtel, who is the biggest beneficiary of this scam with 33 per cent of the International Long Distance (ILD) revenue, has started demanding a much higher level of ITC ranging between Rs 3 to Rs 3.50 per minute. In addition, it has also demanded revenue share in the ratio of 96 to 04 between Access Service provider and ILD operator. Vodafone has demanded to raise ITC to Rs 1 per minute, while Idea has asked for 80 paisa per minute. This is a pressure tactics adopted by these well experienced incumbents.

Worldwide there is a decline in international calls since 2015 as most of this is getting shifted to OTT apps. If, the ILD Operators want to compete globally, they will have to match the tariffs offered through OTT apps, which means zero termination charge. Trai has recently set a deadline of January 1, 2020 to make Mobile Termination Charge (MTC) as zero. Let us hope Trai follows the same yardstick for ITC also.