My Thoughts on Technology and Jamaica: OUR's JA$5.00 Cross Network Flat Rate ratified by Judge Ingrid Mangatal - GOJ's Telecoms Tax applied and Digicel's victory in FTC Case assured

Friday, July 20, 2012

OUR's JA$5.00 Cross Network Flat Rate ratified by Judge Ingrid Mangatal - GOJ's Telecoms Tax applied and Digicel's victory in FTC Case assured

We Jamaicans are now officially on a Flat Rate Calling Rate of JA$5.00 as of Sunday July 15th 2012AD as announced by the OUR (Office of Utilities Regulation), the interim Telecoms body until the new body is officially consolidated.

First Telecom Provider dazzled us with Talk EZ on Friday June 15th 2012AD that had on-Net rates as low as JA$2.99 as described in my blog article entitled “LIME's new TALK EZ Plan drops Cross Network Calling to JA$2.99 - Digicel's Game of Thrones vs LIME Return of the King” and my Geezam blog article entitled LIME drops Cross Network Calling rate to JA$6.99 to kick off a 3 year Battle for Mobile Market Dominance”.

Then Telecom Provider Digicel followed suit with a double scoop helping of a “Sweetest Deal” Promotion one week later on Friday June 22nd 2012AD, which one should note was not a permanent Rate Decline of JA$2.89”. I say double scoop helping as on Wednesday June 27th 2012AD Telecom Provider Digicel also launched their much touted Mobile 4G, albeit like Telecom Provider LIME, it’s not true 4G.

Telecom Provider Digicel was up until Friday July 13th 2012AD disputing the legality of the OUR to set rates on an interim basis in the Supreme Court based on the newly minted Telecommunications Act that went into force in May 2012 upon which the ink had barely dried.

Telecom Provider Digicel had immediately sought a Judicial Review of this before courts while launching their “Sweetest Deal” Promotion as well as claiming that being ill-informed even after having met with the Minister of Science Technology and Energy and Mining Phillip Paulwell. Thus it was in essence a case of Natural Justice being denied for them to have been able to respond to the coming changes.

An opinion Telecom Provider Digicel held since February 2012AD as stated in the article LIME, Digicel at odds over OUR's proposed $5 termination rate”, published Sunday, February 19, 2012, The Jamaica Observer based on the fact that they were not duly informed of the changes.

Notwithstanding this and other argument presented by Telecom Provider Digicel, Puisne Judge Ingrid Mangatal ruled in favour of the OUR effectively opening the doorway for Telecom Provider Digicel to appeal the decision as stated in the article “Court backs watchdog on mobile rate cut”, published Friday, July 13, 2012 BY PAUL HENRY Crime/Court Desk co-ordinator, The Jamaica Observer.

Puisne Judge Ingrid Mangatal handed down her Judgment in a fifty five (155) page document, summarized as thus quote: “Digicel has not made out a case that it will suffer actual, likely or irreparable harm or loss. On the other hand, it does appear to me that Lime will likely suffer financial damage and reputational loss if a stay is granted, particularly as they have indicated that they have already relied upon the interim Determination Notice.”

Telecom Provider LIME was obviously “please like puss” with the ruling as note in the article “LIME calls rate ruling a major victory”, Thursday July 12, 2012, The Jamaica Gleaner.

Telecom Provider LIME’s Managing Director Gary Sinclair pounced upon this irony of a Challenge of the Authority of the OUR and in the same breath launching a promotion with this smug quotation: “Actions speak loudly. We responded to the OUR's lowering of termination rates by immediately dropping our mobile prices to the lowest in Jamaican history and our people reacted very positively. Digicel responded by taking the OUR... to court.”

Telecom Provider Digicel was obviously disappointed with outcome of their Legal challenge as stated in “Digicel loses bid to challenge new call rates set by OUR”, published Thursday July 12, 2012, The Jamaica Gleaner andDigicel disappointed by court ruling” published Thursday July 12, 2012, The Jamaica Gleaner.

Head of Digicel Legal and Regulatory affairs, Richard Fraser expressed Telecom Provider Digicel disappointment with the whole situation, quote: “We are disappointed with today's ruling as we maintain that the OUR ought to have adhered to the principles of natural justice and carried out some form of prior consultation on the issue before issuing its determination”.

Telecom Provider Digicel has also decided not appeal the decision, as from a logical standpoint, accepting it means that their other case against the FTC (Fair Trading Commission) has a strong likelihood of succeeding. This is with regards to the legality of the swap of CLARO Jamaica involving Carlos slim-owned America Movil from Digicel El Salvador and Digicel Honduras.

By accepting Puisne Judge Ingrid Mangatal ruling, Telecom Provider Digicel has set the stage for a victory in this other very pivotal case as now the lower prices in Jamaica in the Voice Telecoms Sector is an indication is alive and well for the next three (3) years..

Telecom Provider Digicel will win the case provided provisions are made to allow other players into the Voice and Data Services Market for Telecoms. As such, Telecom Provider Digicel may have to relinquish some of its spectrum in an out-of-court settlement in the interest of the advancement of the Telecoms Sector.

Good to note here that Triple Play Provider FLOW has also dropped their rates as well to JA$6.99 for Cross Network Calling without argument with the Interim Regulatory body on Sunday July 15 2012AD as stated in the article “Flow rates down”, published Monday July 16, 2012, The Jamaica Gleaner.

Their rate decline to JA$6.99 is also as equally dramatic as that of Telecom Provider LIME and Telecom Provider Digicel as listed below, fodder for a deep analysis article on rates:

1.      Flow to Digicel was previously JA$7.50 (peak hours) and JA$6.50 (off-peak)
2.      Flow to LIME was previously $9.50 (peak and off Peak)

Triple Play Provider FLOW President and CEO Michele “Dallas” English made the following Press Release on the OUR’s mandated Cross Network Rate Tariffs quote: “Since our launch, we have been able to provide our customers with the best pricing on landline telephone service, including being the only telephone service provider offering 100 per cent free on-network calls (Flow to Flow), lower calling rates to call LIME landlines than LIME charges for its own on-network calls and truly unlimited international calls to the most frequently called destinations. Our move to reduce these calling rates is just another step to fulfilling our promise to always deliver the best value to our customers”.

This all coming to pass on  Sunday July 15th 2012AD, a date worth repeating and young children noting in this our Jamaica 50th Jubilee of Independence; freedom from abnormally high On-Net, Cross Network and International Calling Tariffs in the past five (5) weeks.

But while some shackles are removed, some new ones were also being fashioned by the GOJ (Government of Jamaica) under the quiet. Also historical in its implementation due to the cash-strapped nature of the GOJ Budget!

It is the need to find non-elastic sources of taxation that has prompted the GOJ on Sunday July 15th 2012AD to implemented among other controversial taxes, (including on patties too!), the Telecoms Tax as stated in the article “New telephone tax takes effect”, published Monday July 16, 2012, The Jamaica Gleaner.

This is the GOJ’s Pound of Flesh also took effect on Sunday July 15th 2012AD as well, taxing as laid out in my blog article entitled “GOJ taxes Telecom Providers and OUR sets Cross Network and International Calling Rate at JA$5.00 - Data Services Prometheus.

Folks, this is a brave New World and marks a historical transition for Jamaicans to a Flat Rate Calling Tariff that will benefit Telecom Provider LIME over the next three (3) years while boosting revenues by making it cheaper to call more frequently. More importantly the stage is set for more competitive pricing environment in the Telecoms Sector and benefits for customers over the next (3) yeas as Telecom Provider LIME makes a push for Voice Services Dominance

But what of call by Telecom Provider Digicel for MNP (Mobile Number Portability) as stated in the article “Cellphone number portability lagging”, published Monday July 16, 2012, The Jamaica Gleaner?

Fodder to fuel the passionate competitive flames of another article folks........


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