MOBILE-phone users may finally see rates go down. This, as the country’s telecommunications companies recently said they will carefully study proposals from the National Telecommunications Commission’s (NTC), which seek to limit access charges in short message service (SMS) to not more than P0.15 and put a cap of P1.50 per minute for cellular calls.

Access charges are fees paid by a carrier for every minute of call that passes through the network of another carrier. These are major components of the prevailing rates paid by users for both voice calls and SMS.

Every SMS sent includes the charges of the network sending the SMS and the one receiving the text, as well as the cost of interconnection facilities. The existing access charge for SMS is P0.35 per text. The fee for voice calls between cellular networks with separate networks is P4 per minute.

“We will study if the amount of access charge is fair and reasonable to approximate the cost of providing the interconnection services,” said William Pamintuan, Digital Telecommunications Philippines Inc. senior vice president.

Ray Espinosa, head of regulatory affairs and policy at the Philippine Long Distance Telephone Co. (PLDT) Group, said the phone giant is still studying the implication of the NTC draft circulars, which were released Friday.

The NTC believes that if access charges are further brought down, then the retail price of voice and text messaging will be lower. It will also be much lower, if not free, if the call or text is within the same network.

In the draft memorandum circular, the NTC noted that SMS, which consumers pay P0.15 for every text within the same network, is widely used by Filipinos in their day-to-day activities.

In order to make SMS more affordable, the NTC wants interconnection charge between two mobile-phone networks not to go over than P0.15 each.

Also, the commission said SMS should be successfully transmitted to the receiving party within 30 seconds from the time the text message was sent. “SMS network providers shall ensure that facilities are sufficient to guarantee 99 percent of SMS are received by the addresses within 30 seconds,” stated the circular.

“In order for the cellular firms not to deliberately delay SMS traffic as a result of the proposed cap, our circular also directs them to transmit the SMS within 30 seconds,” said NTC director Edgardo Cabarios in a phone interview.

The other proposed circular also directs mobile-phone firms to assure the commission that their facilities are sufficient to guarantee a grade of service of at least PO1, which means that there should only be one loss call for every 100 call attempts, explained Cabarios.

“Each of the parties to the interconnection shall provide the interconnection links or circuits required to carry their respective traffic. The parties shall ensure that termination equipment is sufficient to connect the interconnection links to their respective networks,” the draft circular on interconnection charge for mobile-voice service stated.

“The interconnection charge for voice calls between two separate cellular mobile-telephone networks shall not be higher than P1.50 per minute,” added NTC.

This proposed access charge for mobile-phone service is at par with Thailand and Malaysia, ranging from P1.36 to P1.70 per minute and P1.24 to P1.30 per minute, respectively.

The NTC did not move to change the access charge for landline calls which is currently pegged at P3 per minute. “The cellular [services] control the market now. The fixed-line operators will no doubt move to lower their access charges if the cap on cellular calls is imposed,” added Cabarios.

The draft circulars also require telcos to amend their interconnection agreements within 10 days from the effectivity of the circulars. Public hearings are scheduled on June 4 and 5 at 10.a.m. at the NTC head office.

The NTC issued the draft policies following a directive from the Department of Transportation and Communications (DOTC) last May 26 to “promulgate rules to effectively carry out the objective or reducing or lowering communications costs, and in order to maintain and foster fair competition in the telecommunications industry.”

Last week, the DOTC said SMS should be free of charge. But this pronouncement was widely criticized by the phone firms. They said this will only make the situation worse because they anticipate a deluge of text messaging.

“The network cannot take a deluge of SMS. It will collapse in less than an hour. And when the whole network collapses there will be no more SMS and voice-service offerings. All the networks of all operators will collapse under the weight of free SMS,” said Espinosa.

The PLDT Group handles roughly one billion SMS traffic a day. Globe Telecom’s networks track 500 million to 700 million text messages daily, while Sun Cellular handles 80 million to 100 million a day.

Espinosa said the respective franchises of PLDT, Smart Communications Inc., Pilipino Telephone Corp., and Connectivity Unlimited Resources Enterprises Inc. state that they have the legal authority and right to provide and charge for SMS.

“These companies, therefore, are authorized under their respective franchises to provide SMS as a commercial service. This is also very clear under the respective certificates of public convenience and necessity as well as provisional authorities of each company. This is likewise very clear under the prevailing circulars of the NTC,” said Espinosa.

The government also does not have the legal power to give out SMS since this would amount to an unconstitutional deprivation of property and property rights, he said. “Congress cannot enact laws that will say that SMS should be free because that is unconstitutional, essentially a confiscation of property or deprivation of property without compensation.”

He said in every country around the world where it is available, SMS is a commercial service, adding there is no mobile operator in any country which provides free text-messaging service.

The NTC, meanwhile, stressed that it was its role to promote a fair, efficient and responsive markets to stimulate growth and development of the telecommunications facilities and services.

MOBILE-phone users may finally see rates go down. This, as the country’s telecommunications companies recently said they will carefully study proposals from the National Telecommunications Commission’s (NTC), which seek to limit access charges in short message service (SMS) to not more than P0.15 and put a cap of P1.50 per minute for cellular calls.

Worst beating yet for Meralco

TWO of the Lopez-controlled listed companies were among last week’s biggest losers. These were First Philippine Holdings Corp., an index stock and Benpres Holdings Corp.

New York-listed AES Philippines Corp. interested in participating in the bidding for the energy contracts of the National Power Corp. (Napocor) with independent power producers (IPPs).

PUERTO Princesa—Publicly listed Holcim Philippines Inc. is calibrating its industry growth projections for the year to only 6 percent to 8 percent due to uncertainties caused by the US sub-prime mess and resulting recession, as well as the continued increase in prices of construction materials. 

REAL-estate firm Eton Properties Philippines Inc. is looking at developing two more properties in Cebu and Batangas, while still undertaking the construction of 10 existing projects.

IT was indeed a busy week for Government Service Insurance System (GSIS) president and general manager Winston Garcia. There was, of course, the annual stockholders meeting of Manila Electric Co. (Meralco) on Tuesday where the Lopez Group seemingly won Round 1 by retaining the management status quo chaired by Manuel Lopez.