Sinclair predicts J$2 termination rates
Published:Wednesday | March 27, 2013 | 12:00 AM
LIME Jamaica said Tuesday that it expects its regulator to slash mobile call termination rates by more than 60 per cent to under J$2.
The telecom previously avoided such estimates on the size of the pending adjustments.
LIME says the Office of Utilities Regulation (OUR) will conclude a study to set rates "shortly".
The OUR is currently going through the consultation process on the Long Run Incremental Cost Model (LRIC), which could result in even lower rates.
It was not immediately clear from the OUR, up to press time, when the study would be completed. LIME Chief Executive Officer Garfield Sinclair previously said it could be finalised this month.
LIME expects the OUR to drop the wholesale mobile termination rates "below J$2 per minute from the current interim rate set of $5 per minute" set in June 2012, according to a company release on a speech delivered by Sinclair at a University of Technology (UTech) telecommunications forum last week.
Legislative quick fix
Mobile termination rates are the fees telecoms charge other carriers to transfer calls on their networks. The power to set the interim rate was conferred on the OUR with the passage and signing of the Telecommunications (Amendment) Act 2012. It was a legislative quick fix to a near decade-long legal fight, and mobile providers slashed rates in response by up to two-thirds.
The possible drop by OUR would cumulatively result in a four-fifths slash in rates in less than a year from J$9 to under J$2. Sinclair previously told this newspaper that LIME will drop mobile call rates as soon as the OUR makes its announcement of lower rates.
"This matter of lower wholesale mobile termination rates has been debated, researched and studied for some time now," he said at the UTech forum.
"We believe that the OUR is now in a position to issue its final determination on lower wholesale rates fully informed and do away with the interim rate."
LIME's customers pay either J$6.99 or J$8.39 per minute to call the rival Digicel network.
Digicel does not want lower rates because it would stymie investment and eventually reduce the network size. It made its position known in its response to the OUR's 'Management Accountability Framework Business Plan and Budget', previously posted on the OUR website.
Digicel said that possible plans by the OUR to drop mobile rates even further would result in Jamaica offering the lowest global calling rates.