Interconnection is the lifeline of telecommunications and is therefore important for both service providers and consumers, according to the Telecom Regulatory Authority of India (TRAI). Users cannot communicate with each other or connect with services unless the necessary interconnection arrangements are in place.

Today there are a variety of access networks ?? fixed and mobile, national and international long distance ?? that have to interconnect with each other to make local, national and international calls possible. This plurality makes the type and number of interconnections large and unwieldy if it is not managed effectively. It is, therefore, important to have an effective interconnection usage charge (IUC) regime in place.

Towards that end, and in a further effort to make call tariffs cheaper, TRAI, after various rounds of consultations, has issued the Telecommunications Interconnection Usage Charges (Tenth Amendment) Regulations, with the following key features:

  • Termination charges ?? which are paid by one operator to the other on whose network the call ends ?? for all types of domestic calls, namely, fixed to fixed, fixed to mobile, mobile to fixed and mobile to mobile have been reduced from Re 0.30 per minute to Re 0.20 per minute.
  • Termination charges for incoming international calls have been increased from Re 0.30 per minute to Re 0.40 per minute. TRAI expects that the service providers will pass on this benefit to consumers in the form of lower tariffs for outgoing international calls.
  • The ceiling on the carriage of domestic long distance calls has been retained at Re 0.65 per minute. The non-reduction of this ceiling will encourage national long distance operators to expand into rural areas.
  • Origination charges have not been specified as they would be residual from tariff after payment of other charges. This would give service providers flexibility in introducing innovative tariff plans.
  • Transit/Carriage charge from Level-II trunk automatic exchange to short distance charging area (SDCA) to be Re 0.15 per minute as against the existing charge of Re 0.20 per minute.
  • Intra-SDCA transit charge to be less than Re 0.15 per minute, down from less than Re 0.20 per minute.
  • Termination charge for 3G voice calls to be the same as for 2G voice calls.
  • IUC for SMS to be under forbearance, provided that such charges are transparent, reciprocal and non-discriminatory.
  • The new charges to be effective from April 2009.

    • Given that the IUC review is a complex exercise and requires close interaction with the stakeholders, TRAI had started the consultation process in September 2008. A detailed consultation paper was issued subsequently, touching on issues such as the methodology for calculation of mobile termination charges; should fixed and mobile termination cost calculations use the same methodology; should the mobile termination charge be the same for all existing and new service providers and for fixed and mobile services; how should the termination charge on international incoming calls be fixed; what would be the effect of service providers’ suggestions on tariffs, and how would new networks and services like 3G, Wi-Max and NGN affect the IUC.

    TRAI’s effort has been to evolve a framework that would ensure an effective interconnection regime that would enable competition, ensure that the positive effects of liberalisation reach the largest sections of society and provide sustained growth of telecommunications. In these respects, the IUC framework issued by it will, hopefully, promote growth of telephony and networks.