A third of India’s international incoming calls shift to OTT

More than a third of the duration of the country’s international incoming calls are on over-the-top (OTT) platforms such as WhatsApp, FaceTime, Facebook, Skype, and Google.

This has happened even as incumbent telecom operators, on the one hand, and Reliance Jio, on the other, are waging a bitter war as to whether the regulator should increase or bring down the incoming international termination calls to zero.

The march of technology is increasingly making the debate irrelevant. The duration of international incoming call son mobile phones annually ranges from 84.50 billion to 100 billion minutes, according to tel co sin their presentation to the Telecom Regulatory Authority of India( Tr ai ). But the duration on OT T platforms is to the tune of 50 billion minutes. So33-37per cent (a sof 2016) of all international incoming calls have shifted to these platforms and tel cos seem to be fighting a losing battle. Globally based on assessments made by Te le Geography in 2015, about half the calls around the globe were being made on OT T platforms.

About 120 million customers are using some OTT platform in the country on their smartphones, and industry experts say the number in this category would go up to 200 million in the next two to three years. That is primarily based on the fact that globally any country, with 25 per cent of its customers on smartphones, sees a dramatic shift towards OTT. And India is close to reaching that inflection point, with around 260 million smartphones users and growing exponentially. Telcos estimate that even assuming there is no change in the termination rates, nearly 50 per cent of calls will shift to OTT, following the global trend, and the share of telcos will continue to go down. The Cellular Operators Association of India (COAI) on Monday pushed for an increase in the termination rate, saying that the blended charge paid by Indian telcos for outgoing calls, which terminate on the international telcos’ network, was ~3.50 a minute. However, foreign telcos pay only 53 paise for terminating their calls on domestic networks, creating a large imbalance and a loss of foreign exchange.

They have recommended that the termination charges of international incoming calls should be increased initially to ~1, going up to ~3.50 later on. Currently the international long-distance business provides telcos revenues of around ~5,000 crore.

However, Jio has submitted that the incoming international termination calls should be brought down to zero, as any increase will ensure a quicker shift of international voice calling to OTT, impacting the revenues of domestic telcos.

Rajan Matthew, director general, COAI, agrees that currently 30-40 per cent of the international calls have shifted to OTT players and this move is irreversible.

But he points out that if termination charges at both ends are equalised, outgoing calls are expected to go up, and the undue advantage international carriers have because of the unequal rates will be plugged. That will also help in higher foreign exchange inflows, he says.