Thu, Apr 16, 2009 - Page 4 News List

NCC wades into dispute over Chunghwa Telecom IP fees

ADDING UP The commission said it was unreasonable to charge peers NT$1,500 per megabyte for bandwidths of less than 500 megabytes per second, but NT$3,000 for higher bandwidths

By Shelley Shan  /  STAFF REPORTER

The National Communications Commission (NCC) said yesterday it would schedule another meeting next week to resolve an Internet Protocol (IP) peering fees dispute between Chunghwa Telecom (CHT, 中華電信) and Taiwan Fixed Network (TFN, 台灣固網), two of the nation’s largest telecom operators.

The companies met at the NCC on Tuesday to solve the dispute. CHT proposed changes to its service charges, but the NCC did not accept the proposal.

“It [CHT] presented us with a complicated formula explaining the way they set prices, but we considered the new price to be not much different from the old one,” said Lee Ming-chung (李明忠), an NCC division chief.

Lee said the commission believed CHT could drop its prices further as its infrastructrure costs had already been recouped.

Peering refers to the connection between two separate Internet networks that allows customers to exchange traffic. Since a majority of overseas Web sites can only be accessed via CHT’s undersea cables, other fixed network service providers must use CHT’s peering service.

The dispute over the IP peering fee broke out last week when CHT decided to restrict the bandwidth used for the 2G peering service with TFN last Wednesday because the latter had not paid its fees this year.

TFN said it had been overcharged by CHT and asked to renegotiate a new peering fee.

After learning of the dispute, the NCC dispatched officials to both CHT and TFN to monitor the traffic flow between the two networks. CHT resumed its prior service agreement with TFN the next day under the NCC’s orders.

CHT charges NT$1,500 per megabyte if the bandwidth is smaller than 500 megabytes per second and NT$3,000 per megabyte if it is higher. The NCC said this was unreasonable and that fees for larger amounts should be discounted.

Meanwhile, CHT set six criteria for granting TFN discounts on peering fees, one of them being that TFN IP addresses should reach one-third the number of CHT’s. The NCC, however, believed that the specific criteria could not be met by TFN or any other service provider.

The incident last week caused the NCC to launch an investigation into whether CHT has abused its status as the market leader and whether TFN has infringed its customers’ interests.

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