Telecom operators to get new interconnect rate March

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Telecom operators in the country are to get a new interconnect rate for termination of calls on each other’s network next month.
Executive Commissioner, Stakeholder Management of Nigerian Communications Commission (NCC), Mr Sunday Dare, disclosed this at a forum where the commission presented the findings on the cost based study for the determination of Mobile Voice Termination rates in Nigeria, carried out by PricewaterhouseCooper PwC, in Lagos.
According to him, the new interconnect rate is critical to the growth and of the telecoms industry and a key component of the commercial aspects of interconnection among the network service providers.
He said the commission was working towards ensuring the operators had a new interconnect rate by March this year. Dare, who represented Executive Vice Chairman, Prof Garba Umar Danbatta, also described interconnect rate as the fee an operator charges another for connecting and terminating calls on its network. Earlier, while presenting the welcome address of the EVC, Dare recalled that a key component of the commercial aspect of interconnection was the determination of interconnection rates among network service providers.
He said: “Apart from the first interconnection rate, which was based on negotiation between the then incumbent operator (NITEL) and other operators, all other determinations have been handled by the commission due largely to two reasons: The negotiated interconnection rate was fraught with many controversies. “Secondly, and more importantly, there was need to ensure interconnection rates are cost-oriented in line with international best practice. “Till date, there has been four interconnect cost determination regimes: 2003, 2006, 2009 and 2013. “The 2003 regime was determined via a benchmarking exercise, while the 2006, 2009 and 2013 regimes were cost-based and a glide path asymmetry regime was adopted in 2009 and 2013 respectively, with the 2013 regime expected to expire in 2016.”
“However, economic factors such as the rapid devaluation of the naira in 2016 and the fact that Nigerian network service providers became perpetual net payers to their overseas interconnecting partners led to the commission setting an interim rate of N24.40 per minute for inbound international traffic after carrying out a benchmarking exercise with other jurisdictions and this rate will subsist until a cost-oriented rate is determined by the commission.”

 


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