Although rates have been slashed between 7.8 per cent and 51.43 per cent, BTC intends to make an applicat-ion to the regulator, Public Utilities Commission (PUC), for further cuts.
The new rates, will come into effect in a matter of weeks.
ILD calls per minute are $0.47 to the United States of America, $0.50 to Canada; $0.66 to the Caribbean, $0.85 to Cuba and $0.85 to all other destinations. “Cost oriented rates/prices are a prerequisite for the development of sustainable competition in tele-communications markets,” read a statement in a document released by the PUC.
The statement added: “The government of The Bahamas has made the development of sustainable competition in telecommunications a principal public policy objective.”
PUC said it believed this would discourage illegal operators from bypassing regulatory requirements, and encourage users to “make prudent decisions with res-pect to consumption”.
The presence of illegal operators has made the market increasingly competitive for BTC. While the telecom giant maintains it welcomes comp-etition, it condemned the services offered by illegal operators.
BTC reportedly suffered losses of around $45 million due to competition from illegal outlets. The $90 million the company earned annually from its long distance service has also reportedly been reduced by up to half.
BTC has in recent months moved to reposition itself by improving its services and attractiveness to customers.
Even though ILD rates have been cut, the PUC revealed that prices were still between 62.1 and 100 per cent higher in comparison to the rates offered by The Bahamas’ principal trading partners, including the United States, Canada and Switzerland.
The PUC’s findings also revealed that in comparison to the rates offered by major competitors for tourism and financial services in the region, the new ILD rates were between 20 and 247 per cent higher.
Despite the benefits the cuts will offer to residential users, the tourism sector and financial services, the PUC expres-sed concerns over whether the new rates were below or above the operational costs in providing the service.
What the regulator concluded was that the new rates are “still high by international standards and it is unlikely that these rates are below cost and hence there is no basis for raising concerns about predatory pricing.”
However, BTC said that it is in “a hybrid state of emergence as it awaits decisions on its privatization,” a situation which has hampered its cost structure.
By: BARRY WILLIAMS, Nassau Guardian Business Reporter
