The country\u2019s largest telecom operator Bharti Airtel got hit hard during the October-December quarter by the 57% cut in the mobile termination rate for domestic calls effected by the Telecom Regulatory Authority of India (Trai), with its net profit and revenue missing Bloomberg consensus estimates. Net profit at Rs 306 crore was sequentially down 11% while revenue at Rs 20,319 crore was down 7% compared with the preceding quarter. The company\u2019s Ebitda though at Rs 7,587 crore, down 5% sequentially, was ahead of estimates. Margins expanded to 37.3% compared with 36.8% in the previous quarter. Trai had reduced the MTR component in the interconnect usage charge (IUC) by more than half to 6 paise per minute from the earlier 14 paise with effect from October 1, 2017. Bharti said that as a result of this, gross revenue during the quarter got impacted by Rs 1,062 crore, Ebitda by Rs 338 crore and mobile average realisation per user (Arpu) by Rs 16. With tTrai cutting international termination rates also with effect from February 1, Bharti's earnings during the January-March quarter is also going to be impacted. According to estimates drawn up by Kotak Institutional Equities, the company's annualised Ebitda will be impacted by around Rs 500 crore due to this cut. Bharti Airtel's MD and CEO, India and South Asia, Gopal Vittal blamed the cut in MTR in no uncertain terms: \u201cRegulatory fiat in the form of a cut in domestic IUC rates has exacerbated the industry Arpu decline in Q3\u201918. The recent announcement of reduction in international termination rates will further accentuate this decline and benefit foreign operators with no commensurate benefit to customers\u201d. Apart from the regulatory front, competition in terms of tariffs from Reliance Jio continues on Bharti. In fact, just a couple days back, Jio came out with its new package offering 100% cash back on recharge of Rs 398 and above between January 16-31. Such cash back amounts to lower realisation and while data and voice volume increases, Arpu declines. This trend once again reflects in the operating metrics of Bharti during the October-December quarter. Blended Arpu at Rs 123 was down 15.2% on a sequential basis though minutes of usage per customer for voice increased by 10.9% to 575 minutes. Total minutes on network also jumped 13.1% to 494,546 million on a sequential basis. This is because the company now offers plans which do not charge for voice calls but only data, and here too the rates have come down steeply from a high of Rs 50GB to below 10GB. The results are visible with the total data volume rising 41.1% on a quarter-on-quarter basis to 1105,839 million Mbs. Data usage per customer also jumped 30.9% to 5349 Mbs on a sequential basis. However, India mobile services revenue were down 13.4% sequentially at Rs 10,571 crore, while Ebitda was down by 17% to Rs 3,509 crore.