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Friday, March 29, 2024

PLDT, Globe reducing interconnection charges

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Voice call rates will go down by at least P1 a minute by January next year after PLDT Inc. and Globe Telecom Inc. agreed to cut interconnection charges by 40 percent, the government said Monday. 

Globe and PLDT signed a memorandum of understanding to reduce the interconnection rate for voice calls to P2.50 a minute from P4. The rates will cover mobile to mobile and landline to mobile voice calls.

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

The reduction should take effect not later than Jan. 1, 2017, the National Telecommunications Commission said.

The MOU came after President Rodrigo Duterte called on telco operators to improve and bring down the cost of their services or he would open the industry to foreign players. 

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NTC deputy commissioner Edgardo Cabarios said the reduced retail rate would depend on the various plans/promos offered by the telcos. 

“[But] effectively the retail rates should be dropped by P1 across all plans,” Cabarios said. 

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

“We are supporting the government’s efforts to bring down the cost of telecom services in the country. This agreement will translate in different ways to more affordable voice call rates for our subscribers,” PLDT head of regulatory affairs and policy office Ray Espinosa.

Globe technology chief Gil Genio said the company was strongly advocating for the rationalization of interconnection access charge between the two telcos for many years now. 

“We are confident that a reduction in the cost of interconnection for voice calls will eventually redound to a more robust economy, providing our customers with an affordable and easily accessible way of communication,” Genio said. 

“Even though data is rising, voice traffic continues to grow but revenue is not growing as fast. The lowering of the interconnection could again help us be much more aggressive in voice calling going forward,” he said.

Globe’s mobile voice revenues fell 9 percent to P25.40 billion in the first nine months from last year’s P28.06 billion. 

“The voice business is a challenge as the market for both mobile and fixed actually going to data. It actually lowers the revenue that we generate not only from the customers but on our interconnection that we transfer traffic from each other,” PLDT chief revenue officer Eric Alberto said.

PLDT’s cellular voice revenues fell 18 percent to P28.3 billion in the first nine months from P34.54 billion in the same period last year. 

Telcos’ voice revenues remain challenged given the migration of voice traffic to alternative channels that make use of internet-based applications, such as Viber, Facebook, Skype and Whatsapp.

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