Reliance Jio, India’s biggest telecom operator, has announced that users will now have to pay six paise/minute while calling to other networks. This change comes into effect starting October 10, 2019.
When Jio became public in 2016, it offered free calls and texts to all users along with affordable data rates. It helped Jio to reach the top position in the Indian market, with over 350 million subscribers. It started a price war that forced exiting telcos to slash their prices or risk losing their customers. The intense competition has left only three major operators in the country, the other two being Airtel and Vodafone-Idea (now merged).
According to the statement shared by Reliance Jio, it is now being compelled to recover mobile-call-related charges as a part of the new regulation. This is to compensate for interconnecting user charges (IUC) which are incurred each time an operator initiates a connection with another operator for a call.
What does this mean for consumers?
Starting October 10, Jio users will have to shell out six paise/minute for calls to the other operators. Calls to other Jio users, to landlines and those made using apps such as WhatsApp and Viber will continue to remain free. A minimum balance will have to be maintained along with the regular package that has to be subscribed to if users wish to continue calls to non-Jio users.
These top-up vouchers start at Rs 10 and provide 124 minutes of IUC calls (at the rate of 6 paise per minute). There are similar vouchers valued at Rs 20, 50, and 100, which give proportionally more call minutes.
However, to make up for these additional charges that the consumers will have to face going forward, Jio will offer other data with these top-up recharges for free.
The statement further mentioned that these tariffs would be discontinued once TRAI (telecom sector regulator) brings the IUC charges to zero. There’s no timeline for implementation of the zero-IUC regime, as prices will further go down only when a lot more consumers move to Voice Over LTE (VoLTE).
In the last three years, Jio has paid nearly Rs 13,500 crore as net IUC charges to the other operators. Jio’s net interconnect costs stood at roughly Rs 851 crore in the June quarter, down 23% sequentially, as net voice traffic to its network increased vis-à-vis rivals, given its strong subscriber additions. Jio is now the largest telco by users.