McPherse Thompson, Staff Reporter
CABLE & WIRELESS Jamaica (C&WJ) has introduced per second billing in a bid to attract more customers and compete more vigorously with its main rival, Digicel Jamaica.
The change in billing, which will be applicable to both prepaid and post-paid mobile customers of C&WJ, took effect on Friday and comes against the background of increased competition in the local telecommunications market.
C&WJ's corporate communications manager, Errol Miller, asked what prompted the latest move, said the company "continually reviews its business processes and makes decisions that would, in our view, ensure that we remain the leading telecoms provider."
Per second billing, first introduced into Jamaica by Digicel when it entered the local telecommunications market in April 2001, has proven an attractive option for many mobile customers, and was largely responsible for the build up of the Irish-based company's customer base to some 365,000 in its first year of operation.
In recent weeks, both C&WJ and Digicel have been engaged in a competitive price war, with both companies slashing their rates for making overseas calls.
Digicel cut the overseas rates to $20 per minute in response to a move by C&WJ to reduce its rates to $18 per minute for calls from the fixed local grid to any country in the world.
C&WJ's latest decision is likely to nudge Digicel into reducing the rates it currently charges both for calls made from the fixed network and from its own instruments to C&WJ's mobile.
MORE ECONOMICAL
Digicel currently charges at the maximum of $12 per minute for calls made during peak periods from a fixed line to its mobile network, $11 during off-peak periods, and $10 on weekends.
However, with C&WJ currently charging a flat fee of $7 per minute for calls made from the fixed netowrk to its mobile services, consumers might consider it more economical to use C&WJ's mobile, unless Digicel lower its rate in line with its competitor. With Centennial struggling to build its customer base, it might also consider lowering its $9 per minute charge and adopt per second billing.
Seamus Lynch, chief operating officer of Digicel, said that with C&WJ's introduction of per second billing, competition in the market "is now ringing true."
However, he said C&WJ should also extend similar billing to its land-based customers and that from a consumer point of view, "it's disappointing that they are only now introducing per second billing."
Mr. Lynch welcomed the change, saying he was "glad" that C&WJ has "taken a leaf out of our book."
He also said that that despite Digicel's costs for calls made from a land line to its network "we are still more competitive in our cellular rates across the board. For instance, we still have the most competitive rates in the market for international calls."
C&WJ's introduction of per second billing could also bear on a case Digicel has taken to the Supreme Court, seeking to prevent the Office of Utilities Regulation (OUR) from setting calling rates.
The OUR had proposed a decrease of about one-third in the prices of telephone calls from the fixed network to Digicel's mobile, a decision that was to take effect in July, this year.
However, the new rates have not been implemented because Mossel (Jamaica), trading as Digicel Jamaica, took the matter to the Supreme Court, seeking a declaration that the OUR has no authority to regulate its rates. The case has been set for hearing in January 2003.
In a determination notice issued in May, this year, the OUR decided that the rate should be lowered to about $8 per minute at its highest, and would affect only Digicel, since it was the only company charging at the highest band.
The existing rates are those previously set by the OUR and are based on international benchmarks, which the regulatory agency said have since been reduced.
It was the reduction in the international rates that spurred the OUR to determine that reduced maximum rates should be applicable for fixed to mobile rates for domestic calls on the Digicel network.
However, Digicel has argued that in a competitive and liberalised environment, the rates should be determined by the market.
