The proposed $5.00 termination rate on mobile calls is set to make it cheaper for Digicel customers to call LIME phones than to call friends on their network.
The proposal by the Office of Utilities Regulation for an interim termination rate of $5.00 has garnered different responses from the two telecoms providers with LIME largely supportive and Digicel expressing reservations.
A government document has revealed that LIME’s support might be because it stands to benefit the greatest.
The government document obtained by the Gleaner/Power 106 News Centre looks at the effect of the government’s recently announced tax measures on calling rates.
The analysis also takes into consideration the effect if the full benefit of the reduction of the interim termination rate to $5.00 is passed on to customers.
However, the most striking aspect of the analysis is the rate difference for calls between phones on the same network and that for calls across networks.
According to the government’s calculations, prepaid mobile calls between phones on the same network would cost $11.30 per minute.
This is in comparison to prepaid mobile calls made across networks, which are projected to cost $8.70 per minute.
That’s a turnaround from the current situation in which calls within the same network cost $10.63 per minute and cross-network calls cost $13.13.
However, the government document states that it is difficult to estimate the extent of the reduction, which will arise from the $5.00 rate as various termination rates are currently being charged, ranging from $5.95 to $9.05.
The document said the level of reduction will depend on whether the carriers pass on all the reduced cost to the consumer.
If the termination rate proposal becomes a reality, it could be a significant boost to LIME which has been complaining that the high cost of calling across networks has been stifling its business.
LIME has complained that the high cost of calls by consumers to Digicel phones has been crippling competition, as it deters persons from switching networks.