Government wants to cut interconnection charges to help third telecom player

The government wants to further reduce the interconnection charges for text and voice call services in preparation for the entry of a third major telecom player. 

The National Telecommunications Commission prepared a memorandum circular reducing the interconnection rates for mobile voice calls from P2.50 to P0.50 per minute, and for short messaging services from P0.15 to P0.05 per text. 

The memorandum circular will be subject to a public hearing on June 13.

Sought for comment, Yolanda Crisanto, senior vice president for corporate communications of Globe Telecom said: “We will work with NTC and DICT [Department of Information and Communication Technology] closely on this new initiative.” 

PLDT Inc. spokesperson Ramon Isberto said: “We’re deferring comment while we review this matter.” 

PLDT Inc. and Globe Telecom cut the interconnection charges for voice calls by 40 percent, or from P4 per minute to P2.50 per minute for mobile to mobile and landline to mobile voice calls in January 2017. 

Access charges for mobile to landline voice calls cost  P3 per minute. 

This means the existing retail rates for voice calls will drop to P5.50 per minute from the existing prevailing rates of P6.50 per minute. 

The access charge for SMS between mobile operators was reduced from P0.35 per SMS to P0.15 per SMS effective Nov. 30, 2011, but it was not implemented because of a pending case filed before the Supreme Court. 

Telcos’ voice and text revenues have been affected by the popularity of  Internet-based applications such as Viber, Facebook, Skype, and Whatsapp.

Globe’s mobile voice revenues fell 5.6 percent to P32.27 billion last year from P34.19 billion in 2016, while SMS revenues amounted to P23.14 billion, down from P23.19 billion. 

PLDT’s mobile voice revenues also dropped 17 percent to P30.72 billion in 2017 from P37.09 billion in 2016. Its SMS revenues went down 20.4  percent to P26.04 billion from P32.74 billion. 

The country’s mobile market has a total industry subscriber identification module base of more than 118 million, with an industry penetration rate of 112 percent in 2017. 

Globe had a SIM base of 60.7 million or about 51 percent of the market, while PLDT had 58.29 million.

The reduction of interconnection rates is one of the issues DICt wanted to resolve before releasing the terms of reference for the selection process of the third major player. 

The other issues were the concern on the frequency spectrum, formerly awarded to BayanTel; the establishment of common tower policy; and the commercialization of the National Grid Corporation of the Philippines -Transco Dark Fiber. 

“Once these major issues have been fully resolved, the draft terms of reference will be revised, if necessary, and shall at once be published to gather comments and inputs from all stakeholders,” acting DICT Secretary Eliseo Rio Jr. said. 

“We will leave no stone unturned in providing better telecommunication services to the Filipino people the soonest time possible,” he said.

Topics: National Telecommunications Commission , interconnection rates , Yolanda Crisanto , Globe Telecom , Department of Information and Communication Technology , PLDT Inc.
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