NTC gives Globe, Nextel 10 days to reach interconn

The National Telecommunications Commission yesterday gave Globe Telecom and Nextel Philippines 10 days or until Sept. 3 to come up with a bilateral interconnection agreement or the NTC will impose its own terms.

Starting at 6 p.m. last night, the two companies are supposed to temporarily interconnect. "Since we do not have an interconnection agreement, we will route our traffic or calls made from Globe to Nextel through a foreign carrier and the rates will be based on national long distance (NDD/LEC) charges which is P10 per minute," Globe vice president Froilan Castelo told The STAR.

Starting a week ago, Globe and Nextel ceased interconnection (Globe subscribers cannot call Nextel customers and vice-versa) after negotiations after the commercial terms of their interconnection agreement bogged down.

"We have no problem as far as technical interconnection is concerned. What we cannot agree on is the commercial aspect," Castelo said.

Due to this, Globe and Nextel went to NTC to arbitrate the matter. Under the law, telecommunications companies are required to interconnect and if within a specified period of time, they fail to come up with an interconnection agreement, the government can come in and resolve the matter.

In an interview, NTC commissioner Eliseo Rio said that the commission yesterday gave the two companies its own cost-based computation of how Globe and Nextel are supposed to share in the call rates that they charge to their respective customers.

The NTC scheme provides that calls originating from Globe and terminating to Nextel and vice-versa will have a rate of P7.50 per minute. Of this, Globe will get P5 and Nextel, P2.50.

Rio said that since a call from a Globe subscriber to a Nextel subscriber partly uses the Globe network and that of Nextel, then the call charge should reflect how much the cost of using the network is.

"If Nextel is charging its customers P4 per minute for a call to another Nextel subscriber and Globe charges P9 per minute for a call from a Globe subscriber to another Globe subscriber, then a call from a Nextel subscriber and Globe subscriber should reflect one-half of each network’s cost, which is P2 and P4.50," he said.

The P7.50 per minute is computed based on a P2 Nextel cost plus a P4.50 Globe cost plus a P1 interconnection cost. Of the P7.50, Nextel gets P2 plus half of the interconnection cost which is 50 centavos for a total of P2.50 while Globe gets P4.50 plus 50 centavos or a total of P5.

The amounts are based on the highest subscriber plans being offered by Globe and Network, which is the zero plan for Globe-to-Globe calls and Nextel-to-Nextel calls.

The proposed call charge is lower than what the two companies were charging before they ceased to interconnect. Before, each charges its subscribers P9.50 per minute for a call to the other network. And of the P9.50, Nextel gets P3 and Globe, P6.50, Rio said.

"Our proposed interconnection agreement is system and technology neutral and is based on what Nextel and Globe presently charge inter-network calls," he pointed out.

Rio said that in case in the next 10 days, Globe and Nextel still manage to come up with a bilateral interconnection agreement, then this will prevail over NTC’s proposal.