Everest Amaefule, Abuja

Instead of the partial parity, investigations by our correspondent revealed that mobile operators have insisted on raising the termination rates on mobile networks from N11.52 to N16.50 per minute.

It was also learnt that one of the mobile operators, Vee Networks Nigeria Limited, trading as Vmobile, raised the stakes by asking for a termination rate of N18 per minute.

Interconnect rate represents the charge a telecoms operator that generates a call pays to another operator on whose network the call is terminated.

At present, a minute call terminated on a mobile network costs N11.52 while a minute call terminated on a fixed network costs the generating network N5.52.

NCC had in March, asked mobile operators, who hand over their traffic meant for a fixed network at a nearby destination, to pay a new termination rate of N11.52 instead of the current N5.52.

However, mobile operators that hand over a call for a fixed network at a far-end destination were required to continue paying the subsisting rate of N5.52, while fixed operators were required to continue paying N11.52 per minute call terminated on a mobile network.

The regulatory agency defined far-end handoff as a situation where the originating operator hands over a call to the terminating operator in the state in which the called party is located.

The near-end handoff defines a situation where the originating operator hands over the call to the terminating operator in a location that is not the state in which the called party is located.

The partial parity, which NCC imposed on the industry, was to be in operation until a study it commissioned PriceWaterHouseCoopers to do on cost determined interconnect rates was completed.

For fixed operators, the imposition of partial parity by NCC is a victory of some sort for fixed operators who had been grumbling both in the open and in the secret about how skewed the current rates are in favour of mobile operators.

The Nigerian Telecommunications Limited had in 2005, petitioned NCC for an immediate review of the interconnect rates. The company痴 Managing Director, Mr. Albert Mashi, in an interview with our correspondent said except there was parity of interconnect rates, mobile operators would run fixed operators out of business.

He attributed the high interconnect debts that has bedeviled the industry for some time now, to imbalances in interconnect rates.

He faulted the argument that termination cost on mobile networks should be higher because mobile networks consume more resources. On the contrary, he said, fixed networks, especially cable networks, cost more to build.

Although the Minister of Communication, Chief Cornelius Adebayo, was sympathetic with NITEL, he said the matter was under the purview of NCC, which insisted that due process must be followed. First, there was to be no review until 18 months from the last review.

Mobile operators, who feared that NCC could bow to pressure before the expiration of the 18 months, threatened to go to court to press for the status quo.

They used their common forum, the GSM Forum, to press for a common stand among the mobile operators. They initiated studies that were sympathetic to their cause and had made a case whenever they could.

Our correspondent learnt that at a meeting to harmonise the implementation of the partial parity in Abuja, mobile operators used the power of their market dominance to stall the take off, insisting on increased costs on terminating on a mobile network.

A compromise was, however, reached for all the operators to wait for the study being conducted by PriceWaterHouseCoopers. The result of the study is expected soon to enable NCC make a final ruling by the end of May.

Interconnect rate is very important in the telecoms industry because it is the benchmark that operators look at in fixing their tariffs. No operator, for instance, can charge a rate lower than the interconnect rate, especially for cross network calls.

Industry experts believe that GSM operators want to keep the rates high to ensure that fixed operators do not force down tariffs generally.

Contention over interconnectivity issues dates back to the liberalisation of the telecoms industry but became more acute with the licensing of digital mobile operators in 2001.

The review of interconnect rate in December 2003 sparked off some legal battles between NCC and two mobile operators, MTN Nigeria Communications Limited and Vee Networks Nigeria Limited.

Although NCC won the initial rounds of the legal battles, some aspects of the suits are yet to be disposed of.

Before NCC imposed the partial parity in the industry in March, it also gave the operators the opportunity to agree on common rates. Expectedly, the discussions broke down again and NCC was called upon to intervene. Now the interim intervention has also failed.

THE PUNCH, Friday April 28, 2006