Tuesday , May 18 2021

Mobile rates in war: Claro, Wom and VRT support the government, but Entel issues



Subtel justifies the proposed reduction of 80%. "There is no justification for a minute voice costing more than WhatsApp," he said.

It will be intensely in the next few weeks in the mobile phone industry. On Monday, the government unveiled its proposal to set rates that would regulate the sector between 2019 and 2024: it proposed a reduction of more than 80 percent in access costs.

Of course, Wom and VTR (challengers) came out to support the authority. But Entel (which together with Movistar is dominant) challenges the proposal.

Transport and Telecommunications Minister Gloria Hutt said: "What the government wants is to reduce the cost of access to what is in line with new technologies."

According to the law, the cost of access – what is the cost of the phone company to another call termination in its network – is set every five years, and the last process ended with a 73% reduction. The average today is $ 8.76 per minute.

For the current process, Subtel introduced the 4G model for the model company, which – along with another set of indicators in which an efficient company was defined – proposed an average cost of access of $ 1.36 per minute, which aims to generate greater competition.

Entel doubted that only the 4G network is built into the company's model, not older systems (3G and 2G).

"While the dominant technology in the country today is 4G, in Chile there are more than 10 million people using 3G to communicate, and Vettel's proposal is not considering this technology," said Regulatory and Corporate Signature Manager Manuel Araya.

He said the proposed network does not correspond to the current and future demand in mobile telephony, which would prevent proper servicing of all customers.

However, the undersecretary of telecommunications, Pamela Guidi, was categorical in the defense of the proposal.

"There is no technical or less economic justification for a minute's vote to cost more than WhatsApp or email. So, like Subtel, we believe that our proposal for access fees must be in line with international standards, where voice is already considered for another piece of information, "he said.

Claro Chile's Director of Legal and Regulatory Affairs Cristian Salgado said that "we are fully convinced that the 4G network is technically appropriate technology to propose an efficient model of the company."

In the same way, VTR assessed the technical "firmness" of the proposal. The company's vice president for legal and corporate affairs, Miguel Ounart, backed the decision of the government because, as he said, he recognizes the technical and economic reality of the market.

"It justifies a significant reduction in the cost of access, which is essential for the competitiveness of the industry and for reducing tariffs," he said.

While Vom pointed out the proposal, the director of regulation and corporate affairs, Felipe Simonson, said they point to an even lower access fee.

"It will bring more benefits to competition and to consumers," he said.

Movistar avoided giving statements.

Once the government has submitted its proposal, companies have a five-day deadline to issue a Modification and Insisting Report (IMI) to Subtel.

The idea is that the company using this resource goes to the Commission of Experts, a process in which they propose an expert, the undersecretary appoints another and appoints a third party together.

The opinion of these is not binding, but given the reputation of those who issue them, they usually resolve the differences. If the company is not satisfied, you can contact the controller.

Subtle's plan is to prepare the decrees by the end of January 2019.

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