My Thoughts on Technology and Jamaica: OUR sets Cross-Network Rates at JA$1.10 as of Monday July 1 2013 - Everything is Possible as we’re Zombies for Data World War Z

Monday, June 3, 2013

OUR sets Cross-Network Rates at JA$1.10 as of Monday July 1 2013 - Everything is Possible as we’re Zombies for Data World War Z

“This MTR of $1.10 becomes effective July 1, 2013 and will last until June 30, 2018 unless adjusted sooner on the basis of Section 33(3) of the (Telecommunications) Act. The MTR is to be charged on a per second basis”

Excerpt from the Ruling by the OUR (Office of Utilities Regulation) announced on Thursday May 30th 2013

Looks like I spoke too soon yet again! It didn’t take weeks but the very end of the week before the OUR (Office of Utilities Regulation) announced at 2:30pm on Thursday May 30th 2013 its decision on the Cross-Network Rates or MTR (Mobile Termination Rate) for Telecom Providers to be set at JA$1.10 per minute as I’d predicted in my blog article entitled “JA$2.00 Cross-Network Rates expected from OUR in May 2013 - Postpaid Renaissance, Pain and Gain for Digicel Prepaid in LIME's Ender's Game”.

This is a sharp decline of JA$3.90 per minute from the last Cross-Network Rate of JA$5.00 that was set  on Sunday July 15th 2012 as stated in my blog article entitled “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”. It’s based on the LRIC (Long Run Incremental Cost Model) and becomes effective Monday July 1, 2013 and will last until June 30, 2018 as can be seen above.

This historically low Cross Network Rate was announced in both The Jamaica Observer and The Jamaican Gleaner in their articles “OUR Announces $1.10 Mobile termination Rate”, published Thursday May 30, 2013 6:04 pm by Arthur Hall, Senior News Editor, The Jamaican Gleaner and “Digicel, LIME, Flow ready to battle”, published Friday, May 31, 2013 BY SHAMILLE SCOTT Observer business reporter, The Jamaica Observer.

 The verdict is in and it’s as anticipated in my blog article entitled “JA$2.00 Cross-Network Rates by Saturday June 1st 2013 - Design Homogenous Networks, more Contract and Postpaid Plans and avoid Voice Services Hangover Part III” but much lower than expected and faster than expected, as knowing the GOJ (Government of Jamaica) another month or two down the line.

But truly it’s a historic day for Telecoms in Jamaica as noted in “'Historic' day for talk - OUR sets $1.10 termination rate for mobile providers”, published Friday May 31, 2013 by Edmond Campbell, Senior Staff Reporter, The Jamaican Gleaner.

What the Rate decline to JA$1.10 means: Customer Benefits

From a purely statistical viewpoint, this means that local Cross-Network Calling is only JA$0.10 cents more expensive than International Calling on a Calling plan from any of the Local Telecom Providers as described in my Geezam blog entitled “How to set up an International Calling Plan for Digicel or LIME Prepaid and Postpaid”.

For the most part the Telecom Providers welcomed the decision with hastily trotted out Press Releases. CEO (Chief Executive Officer) of LIME Garfield Sinclair was quick and concise, quote: “Today is a historic day for Jamaican consumers who are poised to benefit from reduced calling rates. This move by the regulator will help to establish Jamaica as a mature mobile market and enable LIME to stay ahead as 'champions of value'.”

Digicel CEO Barry O'Brien was equally and concise and made their pronouncements in their hastily called Press Conference at their downtown, quote: “The ruling came out 2:30 today (yesterday afternoon) and the team is feverishly working to come up with plans, and we are going to hear them in the coming weeks, and Digicel will be passing on significant parts of the value (to consumers)”.

Obviously it’ll benefit customers as it’s a lower Cross-Network Rate, meaning Calls from Digicel to LIME or FLOW or vice versa will only cost JA$1.10 per minute. Thus On-Net Calling Rates are being lowered to being either JA$0.90 per minute or even free, with limits to prevent abuse being placed on Calling similar to that of CLARO Call 2 Text 1 Free Network Feature as described in my Geezam blog entitled “CLARO’s Freeness ends 5th January 2012 – Digicel’s Bigger, Better with Data and Cloud” to prevent abuse.

In essence, CLARO Calling model, which is basically based on Free Calling, will be revived by either Telecom Providers with provisions to make up for lost revenues due to the decline in rates. Thus Telecom Provider Digicel has announced it’s going to make an aggressive play for LIME’s Landline Customers starting July 2013.

MNP and LNP: Coming to a phone near you in May 2014

With the lower Cross-Network Calling rates and possibly Free On-Net Calling Rates, Telecom Provider Digicel’s Mobile Fixed Line Service has the advantage of true islandwide coverage instead of being restricted to Landline from LIME or Coaxial Cables from FLOW.

Thus, like LIME, this is a long term play for LNP (Landline Number Portability) which has been added to the argument for MNP (Mobile Number Portability) as argued in my blog article entitledDigicel calls for MNP for Fixed Line - LIME's Brave Homefone Xpress coming with Telecoms Tax and Flat Rate Tariff”. This will makes them more attractive to Landline Customer looking to keep their phone numbers to switch to a different Telecom Provider.

In the meantime, the OUR has put the brakes on implementing MNP (Mobile Number Portability), despite promises to the contrary by the Ministry of Science, Technology, Energy and Mining in April 2013 of the introduction of MNP  as stated in “Number portability may soon be a reality” Published Thursday March 28, 2013, The Jamaica Gleaner.   

Instead, Telecom Provider Digicel’s arguments have been included in the debate. In the spirit of Due diligence and the lack of a suitable Contractor, MNP and LNP (Landline Number Portability) will be implemented by May 2014 as stated in the article “Number portability timeline pushed back to May 2014”, Published Tuesday May 28, 2013 by Jerome Reynolds, Staff Reporter, The Jamaica Gleaner. 

Increased Calling means increased Revenues: A Network Balancing Act

As it relates to the expected decline in Revenues to the GOJ (Government of Jamaica), that’s a short term effect of a Rate Decline. In reducing Rates, Voice Traffic will increase and so will revenues, with LIME seeing a 21% increase in traffic and Revenues as reported in my blog article entitled “LIME reports Voice Traffic up 71% in Second Quarter of 2012AD - ACS-Xerox loses contract to TELUS International as LIME becomes Mavado Money Changer”.

In the article “Dehring welcomes lowering of termination rates”, published Friday, May 31, 2013, The Jamaica Observer, further evidence indicates a JA$904 million increase in tax paid by Telecom Provider LIME to GOJ coffers.  Furthermore in their Press Release, Telecom Provider LIME also pointed out that, quote: "We at LIME believe that the OUR, nor the Government has anything to be afraid of as the rate reduction will add to the disposable income of mobile users, which then becomes available for use on more of the same or other products and services, all of which attract General Consumption Tax”.

With On-Net Calling now basically “free”, Telecom Providers can introduce Advertising Packages that users can subscribe to via their Digicel InTunes or LIME Blingback Tunes that play advertisements every time some one call their phone number or send them a SMS (Short Messaging Service) as described in my blog article entitled “LIME and Digicel Networks routing Callers to Voice Mail - Hit and Run Advertising while Test out Free Voice Calling”.

M2M Services and Remote Telemetry: The Undiscovered Country

Then there is also M2M Services that can be provisioned to make additional Revenue from the installation of ATM (Automated Teller Machines), POS (Point of Sale) devices as well as any Cashless System as described in my blog article entitled “JA$2.00 Cross-Network Rates by Saturday June 1st 2013 - Design Homogenous Networks, more Contract and Postpaid Plans and avoid Voice Services Hangover Part III

Such Cashless Systems include the JUTC SmarterCard system, which is yet to be rolled out as the expected date of rollout has passed in April 2013 as anticipated in my blog article entitled “JUTC to debut RFID & NFC Readable SmarterCard Cashless Bus Ticket System in April 2013 - The Last Stand for a Cashless Society to empower the Multi-Modal Concept”.

Mobile Money, which the BOJ (Bank of Jamaica) has approved, will be cheaper to implement as described in my blog article entitled “BOJ to regulate and approve Mobile Money Industry in Jamaica - JCCUL JCUES is the Man of Steel as GraceKennedy joins The Last Stand for a Cashless Society” now that the rates are down.

Prepaid Power from JPS Co (Jamaica Power Service Company Limited), when it comes on stream after the upgrade of all the Analog Meters to Digital Meters as described in my blog article entitled JPS Co New Digital Meters are all Smart Meters - Winsome Callum's A Simple Twist of Fate” and my Geezam blog article entitled JPS Co Analog Meter upgrade heralds Remote Billing Revolution, is expected to also generate significant revenues.

Remote Telemetry Services, such as Weather Stations mounted on the top of Buildings and even Cell Towers, Water Meter Reading and Earthquake monitoring will also benefit from the lower Calling Rate, as the EDGE (Enhanced Data Rates for GSM Evolution) and GPRS (Global Packet Radio Service) Data Services uses the same Logical Voice Channels to route Data Services.

Since most Blackberries now access Blackberry Services via EDGE and GPRS, this increased intermittent traffic means persons who use EDGE or GPRS for Internet, be it on any feature, smartphone or Blackberry may eventually be able to use the service for free as described in my blog article entitled “Telecom Provider LIME and M2M Services - Free SMS and EDGE for the Caribbean to Foster Regional Integration”, thereby generating more Blackberry subscribers.

Conclusion: Telecom Providers and Customer Benefit

The Telecom Provider and Customer benefit as with the increasing trend towards Data Services as predicted in my blog article entitled “OUR Telecom Provider Stats indicate JA$14 billion profit for Second Quarter of 2011AD - Telecom Providers Stacking up all Faces on the Argo Video Calling and VoIP on smartphones”, Heterogeneous Networks are a thing of the past and Homogenous Networks are going to be the new Reality in Telecoms.

Hopefully too, more FDI (Foreign Direct Investors) will see these definitive signs from the Ministry of Science, Technology, Energy and Mining as an indication that the Telecoms Market in Jamaica is maturing.

FDI’s should come to Jamaica to bid and invest in one of the two (2) blocks of 700MHz Spectrum as stated in my blog article entitled “No bidders thus far for the 700MHz Spectrum Auction for 4G LTE - CAPEX concerns as Serious Man of Steel Investors are needed to assist Jamaica to become a more Connected Society”, assured that Everything is Possible and we’re ready for Faster Data Services as we’re Zombies for Data World War Z (2013) style.

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