Reduced Access Charges Opposed

Do you remember what I wrote in my recent post about reducing interconnection charges for voice calls and text messages of cellphone subscribers? In the said article, I quoted the news report regarding what happened in the first public hearing conducted by the National Telecommunications Commission (NTC) where the telecommunication companies (telcos) surprisingly did not oppose the proposed reductions in access charges which would result to lower costs of voice calls and text messages. I ended my article by saying I am wondering what could be in store for the draft circulars.

Last week, the telcos submitted their position papers on the proposed reductions and true enough, Globe Telecom agreed with NTC on reducing the interconnection rates for text messages to PhP0.25 in the first year, PhP0.20 in the second year and PhP0.15 in the third year. For voice calls, Globe Telecom also agrees to reduce the access rates to PhP2.50 in the first year, PhP2.00 in the second year and PhP1.50 in the third year. However, while NTC wants to implement the reductions immediately, Globe Telecom wants them implemented beginning January 2012 to allow mobile operators more time to restructure business plans and models given changes in pricing schemes, as well as to help cushion possible losses.

Meanwhile, for reasons similar to that of Globe Telecom, Digital Telecommunications Philippines Inc. (Digitel), the owner of Sun Cellular mobile phone service, proposed to extend the implementation period of the circulars from three (3) years to five (5) years beginning also in January next year. In Digitel’s proposal, access charges for voice calls will go down to PhP3.50 for the first year, PhP3.00 for the second year, PhP2.50 for the third year, PhP2.00 for the fourth year and PhP1.50 for the fifth year. For text messages, Digitel proposes an access charge reduction of PhP0.30 for the first year, PhP0.25 for the second year, PhP0.20 for the third year and P0.15 for the fourth year of implementation.

Among the three (3) mobile phone service providers, it was Philippine Long Distance Telephone Co. (PLDT) who truly opposed the draft circulars and claimed that the proposed reduction in access charges for voice and text messages is unconstitutional. PLDT cited in its position paper that there are still valid, legal and subsisting interconnection agreements between telcos that will be curtailed by the draft memorandum circulars, if issued. The company also said the NTC’s proposed rates are unreasonable and unfair when compared to the country’s present access charges against that of neighboring countries.

Here is again a situation where NTC will have to come out with orders that should benefit the consumers but being opposed by giant companies. Developments on the issue should be of interest to all of us. Do we see again a restraining order from the court if NTC issues circulars contrary to what the giant telcos want?

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