The Department of Telecom has amended the Unified Access Service (UAS) licence agreement, inserting a provision for Internet protocol to allow interconnection of IP-based networks.
"Interconnection between the networks of different licences for carrying circuit switched traffic shall be as per national standards ... and for carrying IP-based traffic as per Telecom Engineering Centre standards as amended from time to time by TEC and also subject to technical feasibility..." says the amendment.
The Cellular Operators Association of India (COAI) said with the amendment telecom players cannot deny interconnection to other telecom operator having IP-based network.
"All operators have their core networks built on IP. With this provision coming in place, now telecom operators cannot deny interconnection to other telecom operator having IP-based network," COAI Director General Rajan S Mathews said.
Earlier networks were built using copper cables, called circuit switch, but modern networks are being built mostly using optical fiber.
A telecom licence had provision of connecting circuit switch based networks with another circuit switch, circuit switch with IP but not IP to IP.
The amendment was required to enable interconnection among upcoming networks which will be based on IP starting with 4G technology.
Telecom operators are also moving towards IP-based network as these have low capital and operating cost as well as more efficient than old circuit-switch based networks.
COAI also said that telecom operators will now have to mutually decide on interconnection usage charges (IUC).
The IUC is fixed by the regulator Trai, which is also looking into interconnection charges for Internet-based networks such as 4G. IUC is paid by one telecom operator to another to connect its subscriber's call or message to the latter's network.
When asked if a telecom operator denies to pay IUC charge demanded by other, Mathews said that ultimately it will go before Trai which will take a call on the issue.
Incumbent telecom operators who still have circuit switch networks are of the view that IUC should be levied on voice calls made through IP networks.
IUC on voice calls made from IP-based networks can escalate cost of Internet-based voice calls, known as Voice Over Internet Protocol (VoIP).