RCOM suggests distribution of differential charge above Domestic Termination Charge

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Reliance Communication in response to the Telecom Regulatory Authority of India (TRAI) consultation paper on review of Interconnection Usage Charges dated 8th November 2019 has submitted that any differential charge above the Domestic Termination Charge should be mandated to be distributed between ILDO and access provider.

RCOM said that Indian ILDOs are facing challenges of sustenance due to low revenue margins and also have to bear the brunt of the exchange rate fluctuations as well as long payment cycles in the international market.

It said that while the Government and the Regulator have been helping the Access service providers who are facing low margins, similar help is needed especially for the ILDOs who don’t have access to a large captive access network.

It pointed out that the interest of the standalone ILDO needs to be taken into consideration while deciding any regime on ITC apart from the issues of imbalance in incoming and outgoing traffic, grey market operation, and traffic shifting to OTT voice application.

“RCOM suggests that any differential charge above the Domestic Termination Charge should be mandated to be distributed between ILDO and access provider in the ratio of 60:40.

If such distribution of differential revenue is not mandated by TRAI, it will lead to a vertical squeeze in international traffic. This would mean that standalone ILDO would not be able to compete against the integrated service providers.”

On TRAIs question as to whether there was a need for the change in the regulatory regime for International Termination Charge (ITC) given the changes happening in the international telephony market structure, Reliance Communications said,

In its ending comments, RCOM said that TRAI should actively engage with Regulators in major traffic exchange countries for making a low reciprocal arrangement for ITC between such countries which would help reduce the cost of outgoing ILD calls for Indian subscribers and also help to shift the traffic back from OTT to PSTN.

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Avatar of Basil Kannagi Arasu
Basil Kannagi Arasu

Editor-in-chief

Basil keeps an eye on the latest happenings in the Telecom sector. In his free time, you can find him streaming the Premier League which he started watching in 2013.

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