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GSM tariff: NCC reviews Mobile Voice Termination Rates

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The Nigerian Communications Commission (NCC) has announced that it has kick-started the process of reviewing mobile voice termination rates for telecommunication industries in the country.

NCC Executive Vice Chairman, Professor Umar Garba Danbatta, who was represented by Director of Policy, Competition and Economic Analysis, Miss Josephine Amuwa, made this disclosure at a stakeholders’ forum on the Cost Based Study for the determination of mobile voice termination rate for the telecom industry, yesterday.

ImageFile: Josephine Amuwa, NCC Director of Policy, Competition and Economic Analysis
NCC Director of Policy, Competition and Economic Analysis, Miss Josephine Amuwa.

According to Danbatta, the move would make the industry achieve full competition and effective regulation by providing a level playing ground for all participants.

He said, “Since the last determination, the Nigerian communication market has witnessed tremendous growth in both subscriber numbers as well as traffic volumes.”

He said the changes are available in technologies (2G, 2.5G, 3G and 4G) and other network elements, including global financial markets which have an impact such as the cost of capital.

Also read: NCC might end up hiking price of GSM Call Rates

“The scale of changes will inevitably affect the unit cost of providing services, including interconnection and may lead to differences between regulated interconnection rates and underlying costs which, in turn, may result in differences between on-net and off-net retail tariffs.

“It’s very important we ensure that interconnection services are not only fairly priced and non-discriminative, but should reflect the cost of providing such services in the market. It is in this regard that the Commission has decided to review the rates set in 2013, in the light of the current market realities,” said Danbatta.

He said the Commission had engaged PriceWaterhouseCoopers (PwC) to carry out an impact assessment on the subsisting interconnect regime; identify shortfalls on the subsisting interconnection rate regime and provide workable solutions.

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He added, “Others are to determine if there is need to have different termination rate for national/domestic and international traffic; determine the mobile termination rate for voice services, using appropriate cost modelling techniques for new entrant(s)/small operators and existing/big operators.

“Pricewaterhouse is also expected to determine the appropriate basis for glide path if necessary; develop a suitable definition of a new entrant(s)/small operator to enjoy the benefits of asymmetric rates; determine the cost per minute session for the use of unstructured supplementary service data”.

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