By Lavern Clarke, Staff ReporterCABLE & Wireless Jamaica (C&WJ) will be introducing 'per second' billing on its fixed line operations, says president Gary Barrow. But the telecommunications giant first has to get regulatory approval before it can proceed.
Barrow told Wednesday Business that C&WJ's dominant position in fixed line service restrains it from adjusting domestic rates without the approval of the Office of Utilities Regulation (OUR).
"It's not as simple as people think," said the president, adding that his company would soon be submitting its plans to restructure its billing regime to the regulator.
The phone giant's peak rates now stand at 40 cents per minute within parish, and $1.05 for parish-to-parish. The rates were adjusted November 1, following a September approval of a new price cap regime by OUR.
Director-General of the OUR, J. Paul Morgan, says notwithstanding Cable and Wireless' dominance of the fixed line market, there are no restrictions on the phone company going per second.
"Whenever they are going to make a change, we just want to take a look to ensure that it won't unreasonably prohibit the other competitors from participating fully," said Morgan.
The regulator also signalled that a move to per second billing would be viewed favourably as it would be beneficial to customers.
The company has already gone per second billing on its mobile services, a regime it implemented in December in response to competition in that market. It does not enjoy dominant status in cellular services largely because of the competition it faces from Digicel in particular and so did not have to hurdle regulatory approval on that business decision.
Currently, C&WJ is the only company actively operating in the fixed line market, but a new entrant, Gotel, is now finalising plans to start offering fixed service via a wireless network.
Morgan says currently Gotel is the only other "serious player" alongside Cable & Wireless in fixed lines, a market that was liberalised in 2000.
In a new five year agreement arrived at in September, in which C&WJ is allowed to adjust its rates based on inflation, Cable & Wireless is now constrained by a cap on its rates.
OUR, in its review of the island monopoly services, including JPSCo, set a new pricing regime that fixed the movement in prices to inflation and a productivity index.
The agreement for Cable & Wireless allows its rates to move at inflation minus two per cent in year one of the agreement, and inflation minus six per cent for the remaining four years.
Adjustments are allowed on the proviso that the company must shown improvements in efficiency.
Morgan says that since the company is bound by the cap, OUR is not expecting Cable & Wireless to seek a rate increase as part of its plans to move into per second billing.
