Increased BTL rates fuel controversy

The Island Newspaper, Ambergris Caye, Belize            Vol. 11, No. 46            November 22, 2001

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As predicted when the government announced they would cancel the contract with Belize Telecommunications Limited (BTL) at the end of this year, the "Value of Voice" will now be more valuable than ever-to BTL. As of December 1st, the most alarming increase announced will be local calls within San Pedro which, alone, will increase from 15 cents per call to 10 cents per minute!

    In a release issued last week, the telecommunications monopoly stated, to prepare for competition, they must improve their services to "aggressively defend" their market position. Essentially what this means is, since BTL has already established the land lines for local and national service, the competition will target the markets of international and cellular service. It is the opinion of many that BTL intends to continue dominating the domestic market by holding the country hostage with their existing land lines. Thus, BTL needs to compete in international and cellular markets only and will lower rates for these services. By reducing international rates for future competition, they claim they can no longer subsidize their high cost of providing phone service to the domestic market (local and national calls) because the profits from the "once lucrative" international market are no longer there.  Although they boast some of the largest profits of any company in the country ($40+million per year), to generate the revenue needed to cover "their investments," BTL is raising domestic phone and Internet rates. Due to the "availability of new technologies that threaten to bypass the traditional international market," international calls can now be made "for a song" around the world (except where they are blocked from use, such as in Belize due to BTL's exclusive license, i.e., IP Star).

    Subsequently, as of December 1st, businesses and the general population must suffer rate hikes 2 times what they now pay just to have a phone line and a rental phone. Line access and maintenance fees will be $50 for businesses compared to the current $20; and $20 for residences compared to the current $8 charge. Internet users are in for a surprise as well. The previous $40 charge for eight FREE hours of usage will be no longer. The new rate will be $24 PLUS ten cents per minute for the first twelve hours and five cents per minute after that. Essentially, Internet will cost $72 for the first eight hours instead of the current $40. Simply put, besides the $24 access fee, rates will increase to $6 per hour up to 12 hours and decrease after twelve hours to $3 per hour as opposed to the previous $4.

    Many rates are based on a standard versus economy rate. Standard hours are from 6 a.m. to 8 p.m. and economy hours are from 8:01 p.m. to 5:59 a.m. The ten cent per minute call within San Pedro will drop to five cents during economy hours. Lower rates will apply for national long distance: Zone 1 standard calls drop from $.25 to $.20 per minute; Zone 2 standard from $.55 to $.40 while economy rates in both zones will remain the same, $.15 per minute.

    Those who use international long distance will benefit the most as calls to the US drop from $2.75 to $1.75 per standard minute; and from $2 to $1.50 economy. Other international rates will decrease as well. Cellular services will also be reduced as activation rates drop from $49 to $40 and monthly access from $35 to $25. Cellular phone call charges will decrease as follows: Standard Cellular - standard minutes will decrease from $.70 to $.55 and economy from $.40 to $.30. Prepaid cellular standard minutes will decrease from $.99 to $.90 or $.70 during economy time. Other benefactors will be customers with "low telephone usage and those in the very low income group." An economy package will give them "the freedom to receive calls with outgoing calls limited to emergency and prepaid services only." These people will enjoy the current $2 phone rental fee and only $10 access and maintenance fees which include the $2 Prepaid calls.

    According to BTL this rate revision will save customers $3 million, although the formula to arrive at this figure was not revealed. To soften the blow the company promises new digital telephone sets, making possible added services such as caller ID, call waiting, speed dialing and message waiting indictor. A new high-speed Internet service and other value added or ancillary services were mentioned as well, but charges for all of these were not disclosed.

    In response to this, the Public Utilities Commission (PUC) issued a letter to BTL which advised that based on complaints received they intend to hold a full hearing if the proposed rates are implemented. This may seem contrary to a September report in this newspaper, that the PUC was not an active body when the existing BTL contract was signed into effect in 1987. It was stated then the PUC could not be involved in the telecommunications process until it was "deregulated" when their contract expired in December 2002. But, in their release they stated, "The PUC reserves this right under Section 15 of the Public Utilities Commission Act of 1999 (PUCA 1999) following any complaint from the public about rates charged by public utility providers."

    The PUC continued, "With the intention of being responsive and in order to make a full assessment of the financial and social implications for consumers, the PUC has called on BTL to substantiate claims that domestic tariffs are artificially set below cost and are subsidized from international revenues - hence their proposal to rebalance tariffs. The PUC maintains that consumer interests must be protected and that, in the present situation where there is no clear and concrete information indicating how consumers may benefit, tariff re-balancing should remain as a long term objective, phased in along with the realization of effective competition in the Belizean Market. After the conclusion of the hearing, the PUC shall make an order that imposes such conditions as it considers proper."

    The Public Utilities Commission invites the public to forward their concerns about the new rates by E-mail to puc@btl.net or by fax at 02-71149.



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