NTC: Telcos owe subscribers P6.5-B in refunds

By Alvin Elchico, ABS-CBN News

Posted at May 08 2014 03:04 PM | Updated as of May 09 2014 05:36 PM

MANILA, Philippines – Telecommunication firms have to pay an estimated P6.5 billion in refunds to customers and fines for not implementing an earlier ruling of the National Telecommunications Commission (NTC) to slash short messaging service (SMS) rates to P0.80 from P1.

NTC director Edgardo Cabarios, head of the regulations department, said when the NTC brought down the interconnection charge between telcos to P0.15 from P0.35, the P0.20 reduction should have been returned to the subscribers or consumers.

"Nakatipid sila ng P0.20 na hindi binalik sa subscribers, so saan napunta ang P0.20 centavos?" he said.

Cabarios said in the estimated P8.5 billion refund of the 2 billion text messages sent daily, around 10 percent are regular text messages which cost P1 per message sent, making up around 200 million text messages, of which only 20 percent have crossed other networks.

Thus, the 40 million regular text messages multiplied by P0.20 by 800 days (from December 2011) equals P6.4 billion.

Aside from this, there is also a P200 per day penalty for the non-implementation of the order or around P160,000 for 800 days. Thus, the total of around P6.5 billion in refunds.

The NTC on Wednesday denied the motions for reconsideration filed by PLDT’s Smart Communications Inc. and Digitel Mobile Philippines Inc. and Globe seeking to reverse NTC’s order on the rollback of SMS rates.

But Cabarios admits the decision is not yet final since the telcos are still likely to appeal the decision.