Court Denies Interim Relief To Airtel, Idea On Interconnect Charges
Bharti Airtel, Idea Cellular challenged TRAI’s decision to slash IUC charges.
The Bombay High Court denied Bharti Airtel Ltd. and Idea Cellular Ltd. any interim relief after the telecom operators challenged the telecom regulator’s decision to slash interconnection usage charges by more than half.
The Telecom Regulatory Authority of India’s decision will not have an immediate impact on the telecom operators and does not warrant a special relief, the court said.
The TRAI had on September 19 lowered the charges that operators pay for cross-network calls to 6 paise a minute from 14 paise, and decided to completely abolish them from 2020. TRAI Chairman RS Sharma told BloombergQuint earlier this week that the reduction was fair. He said abolishing IUC by 2020 made sense as all operators will move to a data-based network.
The operators contended in the court that technology change is not part of TRAI's jurisdiction. It is the duty of the regulator to protect the interests of the service providers and consumers, they argued.
An operator pays IUC whenever a rival provides access to its network to complete a call. Reliance Jio, which offers free voice calls, had demanded that the charges be abolished. Its older rivals wanted an increase.
Larger players like Bharti Airtel, with deeper rural networks and premium pricing, typically see significantly higher traffic of incoming calls than outgoing, according to a report by Kotak Institutional Equities in July. Which means, they are the net earners of interconnect charges. An aggressive player like Reliance Jio is a net payer.