PLDT questions NTC order on text rates

MANILA, Philippines - The Philippine Long Distance Telephone Co. (PLDT) is questioning what it considers a “vague” order by the National Telecommunications Commission (NTC) directing telecom providers to slash the rates slapped on text messages by 20 percent.

Ray Espinosa, head of PLDT’s regulatory and policy affairs, told reporters on the sidelines of the launching of TV5’s online media properties that the company could not comply with the NTC directive.

“We cannot comply because that’s a vague ruling. To which short messaging system packages will it apply?” Espinosa asked.

A memorandum circular issued on Oct. 10, 2011 or the “Interconnection Charge for SMS” reduced the SMS or text interconnection charge to 15 to 35 centavos for the purpose of making text messaging more affordable to the public pursuant to the directive of the Office of the President. It should be implemented from Dec. 1, 2011.

Last Nov. 20, NTC directed PLDT’s Smart Communications Inc. and Digitel Mobile Philippines Inc. as well as Ayala-controlled Globe Telecom Inc. to reduce the fee on text messages to 80 centavos from P1 and to refund 20 centavos per off-net text messages sent by subscribers since Dec. 1 last year in compliance with the memorandum circular.

“What was the nature of the NTC order? Is it directing the lowering of the retail rates? It did not. They just reduced the interconnection rates,” Espinosa said.

Espinosa said the PLDT Group would file a motion for reconsideration before the NTC to question the NTC directive.

He said the NTC directive could not apply to postpaid subscribers that have contracts with telco providers as well as subscribers of unlimited text promos.

“You cannot direct rates on a postpaid plan, it is unconstitutional,” Espinosa said.