Executive Commissioner, NCC, Stakeholder Management, Chief Okechukwu Itanyi
Bharti Airtel has called on the Nigerian Communications Commission (NCC) to reduce the interconnect charges between operators to enable further reduction in call tariffs.
Group Director, Corporate Affairs of Bharti Airtel, Mar ender Gupta , who made this call in Barcelona, when he received board members of NCC at the Airtel stand, stressed that at N9 , the nation’s interconnect rate was too high and should be made friendly.
Gupta said “from our research, we have discovered that interconnect charges between operators is high and we need your intervention in that regard. We are not saying that interconnect rate should come free, but we believe that it should be friendly. We also believe that the model for arriving at the interconnect charges should be handled by experts.”
Gupta also called on the NCC to speedily commence number portability in a bid to give consumers a choice in moving from one operator to another.
He emphasised that number portability was already extensively used in India , despite the fact that services offered by operators was about the best in the world.
He added that in India , networks were in good shape and the number portability model was high. He explained that was possible not because it was a regulatory requirement but it gave customers a choice.
He emphasised that Airtel would revolutionise service delivery in the country urging the commission to intervene in the two areas, which he described as crucial.
Recall that NCC had in December 2009 unveiled a new set of interconnect rates. The rates determination applied the Asymmetric Interconnect rate method whereby new mobile operators enjoy higher termination rates than the older operators as a result of the study that showed that such operators expend higher cost of termination in their networks. The study was carried out by German firm Datacom.
The new rates, which replaced the earlier ones issued by the commission in 2006 was expected to cut telephone tariffs by as much as N4 per minute.
The new rates favour the new players over the old because they get to enjoy higher interconnect rate up till 2012, when they will terminate equally. The old interconnect rate was N11.25, and the new rates mostly favored Etisalat, which was new then. The way it works is that if MTN terminates a call on Etisalat, it will pay Etisalat N10, but if Etisalat terminates a call on MTN, it will pay N8
The rates led to call terminations on new entrants’ networks graduating from N10.12 to N8.20 in 2012 while call terminations on older operator’s networks was fixed at N8.20 over the same period.
The rates also affected the determination of interconnect rates for Short Messaging Services (SMS) for the first time in the country with new entrants set to enjoy interconnection rates starting from N1.94 to N1.02 in 2012. The other (older) mobile operators stayed on a fixed N1.02 bar over the same period.
The commission also listed two conditions for the determination of the new interconnect rates. First, an operator is qualified as a new entrant if the termination service is provided under a licence that was allocated after 01/01/06 and is less than four years old. Second, the provider (or a company bought by the provider) of this termination service should not have provided this service in Nigeria before 01/01/06 (under a different license).