Interconnection Usage Charges
Also called: IUC, Termination charges, Mobile termination charge · Topic: Infrastructure: Transport, Communications and Energy · NCERT: Beyond NCERT
Meaning
Interconnection usage charges (IUC) are what one telecom operator pays another for using its network to carry or complete a call. The main part is the termination charge. When your operator's customer calls a customer on another network, your operator pays that network to "terminate" the call, which means delivering it to the person being called. The other network can be the only route to its own customer, so TRAI (Telecom Regulatory Authority of India), the telecom regulator, fixes these charges instead of leaving them to bargaining. A low or zero charge makes calls cheaper and helps smaller operators compete.
Example
A customer on Operator A calls a friend on Operator B. Operator A pays Operator B a termination charge for each minute of that call. In February 2015, TRAI set the mobile termination charge (the charge for ending a call on a mobile network) to zero for calls coming from wireline phones. It also set the fixed termination charge (the charge for ending a call on a landline network) to zero for calls from any network. TRAI's aim was to support investment in wireline networks that carry high-speed internet.
Don't confuse with
- Port charges: a charge for the physical link between two networks at the point of interconnection, priced by the size of the port. They do not depend on how many calls or minutes pass through. The interconnection seeker pays them to the interconnection provider.
- Adjusted gross revenue (AGR): the revenue figure on which an operator pays licence fees and spectrum usage charges to the government. It is not a payment between operators.