Cellphone firms still using old billing system

Despite the effectivity of the new telecommunications billing rules last Oct. 7, the country’s two major cellular phone firms have yet to comply with the directive.

Both Globe and Smart Communications, Inc. are still using the per minute billing instead of the six-second charging.

A check at the customer service department of the two companies showed that the current set-up still prevails since they are still awaiting official word from the National Telecommunications Commission (NTC).

Smart and Globe have already submitted a joint position paper before the NTC opposing the new scheme and requesting the NTC to make it realistic with existing market conditions.

They pointed out that pulse billing will result in serious losses and require massive overhaul of the entire system of adjustments in the interconnection among carriers who cannot distinguish pre-recorded announcements in another network.

"A carrier that implements per pulse billing, when it is interconnected to another carrier will undoubtedly suffer serious losses since its pay-outs will exceed its collection. We believe that the current circular does not take this into account," Globe and Smart said.

The two firms also objected to the two-year validity of pre-paid phone cards which they claimed would impair the viability of the business.

At present, the carrying cost of a subscriber is at least P120 a month, inclusive of tax but before interconnection charges.

On the other hand, the smallest pre-paid card denomination sold in the market is P200, consumable over two months or P100 a month, which is lower than minimum monthly landline charges of P550 monthly.

If the expiration had to be lengthened up to two years, cellular companies could no longer sell cards of such small denomination, thus, defeating the primary objective of offering the convenience and flexibility to spend as low as P100 a month on telephone service, Globe and Smart said.

"Lengthening the expiration date of a pre-paid card would result in the failure of the pre-paid service to contribute revenue to realize the minimum costs of maintaining the pre-paid service," they said. In another development, Globe announced yesterday that it has already placed an integrated nationwide GSM network consisting of 11 mobile switches with a total 2.7 million subscriber switch capacity, 905 cell sites, nine home locator register facilities with the ability to handle subscriber database of up to 5.4 million and 11 short message service centers capable of processing over 10 million messages per hour.

"We are seriously and intently pursuing our GSM network build-up with a total investment to date amounting to $700 million since 1994 when we first embarked on this business and we intend to intensify our infrastructure build-up carried over next year," according to Globe president and chief executive officer Gerardo Ablaza, Jr.

Ablaza said that Globe plans to have a total of 1,110 GSM cell sites by yearend.