Cellular companies must lower rates

Cayman’s two major cellular service
providers must lower the rates they charge one another for terminated mobile
phone calls, the Information and Communications Technology Authority board has
ruled.

The charges, known as mobile
termination rates, are charged when a LIME cell phone user calls a Digicel cell
phone user or vice versa. The current termination rate is $0.185 per minute.

The termination rates are only
charged when a user of one company’s cell phone calls another. These rates are
not charged when a LIME customer calls another LIME cell phone user, for
instance.

According to the authority, both
companies agreed to lower the mobile termination rates from $0.185 per minute
to $0.0896 per minute in December 2009. However, there was a dispute over
whether that rate should be changed immediately or implemented over the course
of 30 months.

The lowering of the mobile
termination rate may not have any effect on cell phone customers’ monthly
bills.

“The MTR (mobile termination rate)
is a rate the companies pay each other,” said Mark Connors of the ICTA. “It
doesn’t directly affect the retail rate and is not a direct pass-through to the
consumer.”

Last month, the authority said the
lower rate should be implemented immediately.

Digicel asked the authority to
reconsider its decision, arguing that the ICTA had not given sufficient
consideration to global best practices, including the economic reasons for
‘glide paths’ – meaning phased implementation – of lower mobile termination
rates.

“… the lack of a glide path will
impose losses on subsets of services and contracts with the potential to tip
operators into insolvency or losses,” Digicel said in its reconsideration
argument.

LIME representatives indicated that
both companies had agreed to the lower mobile termination rates in December
2009.

“The only dispute referred to the
authority in respect of the MTR was the application or non-application of a
glide path to arrive at this rate,” LIME argued in its submission.

The authority eventually agreed
with LIME that a lower termination rate had been accepted, and disagreed with
Digicel about a delay in its implementation.

The decision of the Information and
Communications Technology Authority can be appealed in court.

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1 COMMENT

  1. I am having problems with my blackberry so I went top LIME’s office in Galleria Plaza. My bb has been losing signal for some time now. To my surprise, i was told my the Customer Service agent that LIME knows about this and they cannot do nothing about it.. what a poor excuse for a Telecom Service. Also, I was told another bombshell that LIME is increasing their charges and we will see it on the next bill. That goes totally against what the above article states and LIME gave no notification. With the amount of tourist visitiing this island especially US citizens, can CIG look at inviting another telecom company to set up office here? I will be there first customer.

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