Globe asks NTC to dismiss case on lower text charges

MANILA, Philippines - Globe Telecom has asked the National Telecommunications Commission (NTC) to dismiss a case filed against it for violating an NTC circular which lowered the SMS or text messaging rate from P1 to 80 centavos per text from Dec. 5-9, 2011

Globe pointed out that because of effective competition in the SMS offerings, particularly the unlimited text promos, it cannot be said that the consumers are damaged and prejudiced. 

“The pricings of SMS now are so low that competing telcos are virtually cutting each others’ throat. The consumers are given more than enough alternatives to chose from given the myriad of SMS offerings. They are not compelled to pay P1 per text as they can choose from amongst the lower SMS offers,” it said.

Company officials said that because of the many unlimited text offerings, the effective price of text today is about 12 centavos per text only, which is much lower than the 80 centavos per text ordered by the NTC.

Globe also noted that the NTC order does not convey expressly or impliedly in any way that the circular mandates that the regular cost of text shall be 80 centavos only. If a person is penalized despite an unclear and silent law, NTC will be guilty of gross violation of constitutional due process, it said.

It likewise stressed that a prior NTC circular on billing of telecommunication services provides that the rates for cellular services are deregulated or exempted from rate-fixing by the NTC. 

“Thus, NTC does not have the power and jurisdiction to fix the regular retail rate of SMS from the prevailing P1 per text to only 80 centavos per text. NTC MC No. 13-06-2000 also provides that the maximum rates shall be the prevailing approved rates as of the date of the circular’s effectivity which is June 16, 2000. The approved text rate at that time was P1 per text exclusive of the 35 centavos access charge and 12 percent or 12 centavo VAT. NTC has no jurisdiction to rate-fix by quasi-legislation,” Globe emphasized.

The NTC earlier ordered Smart Communications, Globe and Sun Cellular to explain why, despite the issuance of a circular lowering the interconnection charge from 35 centavos to 15 centavos, they still have failed to lower, as a necessary consequence, its regular rates for text messaging by at least 20 centavos per SMS.

Smart said in a statement that they wish to reaffirm their position that the company has fully complied with the NTC’s memorandum circular lowering SMS interconnection rates between carrier. “It is also worthwhile to point out that SMS is a deregulated service. In any case, the lowering of the interconnection charges enables Smart to offer more attractive SMS service packages ranging from premium and regular SMS to bucket and unli plans,” it pointed out.

The company added that competition among the carriers has produced very affordable service offers that have already reduced the effective per SMS rate to around 10 centavos per text message.

The telcos were likewise ordered by the NTC to preserve and submit all SMS data records of all subscribers charged P1 per SMS sent containing details such as SIM number, Date, quantity of SMS per date from 12:01 am of December 2011 until such time that the commission requires.

In the meantime, Smart, Globe and Sun were required to submit a weekly report to the NTC as to the total quantity of SMS charged P1 per SMS commencing from the said date.