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NCC to cut cost of landline calls

Starting in 2011, when a phone call is made from a regular phone to a mobile phone, the charge will be determined by regular phone service operators, rather than by the mobile phone operators, according to a National Communications Commission (NCC) resolution announced yesterday.

The measure, once it takes effect, will help lower call rates by approximately 50 percent.

"The new policy will enable users of regular phones to have less expensive telecommunications service and more selections," NCC spokesman Howard Shyr (石世豪) said. "In the meantime, regular phone operators may be able to present more flexible marketing strategies and create a fairer competition in the market."

Shyr said the government decided in 1997 to deregulate the telecommunications market. And to help develop mobile phone service in the private sector, the government decided that service operators at the receivers' end are entitled to set the price.

While the national policy has successfully created a booming mobile phone industry, it has decreased the number of regular phone users, Shyr said.

Since the mobile phone industry is now well established, the rate plan needs to be changed, he said.

On average, it now costs between NT$6.2 and NT$6.6 per minute to call from a regular phone to a mobile phone.

The regular phone service operators receive about NT$1 to cover the cost of connections, while the mobile phone service operators receive about NT$5.

While nearly half of the revenue is used to cover the cost, half of it is profit.

Shyr said that over the years the mobile phone service has benefited a great deal from the scheme.

The NCC used Chunghwa Telecom as an example. Last year, the company found that the time spent on calls from regular phones to mobile phones reached 4.95 billion minutes. Multiplied by the average price per minute, the company's revenues should have been more than NT$30 billion (US$909 million).

Shyr said the NCC would require cellphone service operators to reduce their phone charges by a minimum of NT$0.47 per minute annually. Operators with significant market power were given of six years to gradually reduce the price. In other words, the price will decrease from NT$6 to NT$3.78.

For the policy to take effect, the commission must first amend other relevant telecom laws.

Meanwhile, the commission has proposed another draft regulating the delivery of spam, or junk e-mail. The draft gave the public the right to request compensation for the damages caused by illegal spam senders, who could be asked to pay between NT$500 and NT$2,000 for each junk e-mail they send.
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