Ukrtelecom wants to double interconnection rates with mobile operators

Ukrtelecom (UTEL) is lobbying for the signing of new agreements on interconnection rates with mobile operators, proposing to double charges for mobile-to-fixed calls. According to Ukrtelecom’s press service, the company considers old agreements with mobile operators (which stipulated interconnection rates) invalid for 2009. Currently, mobile operators charge UAH 0.50 per minute for incoming calls from Ukrtelecom’s network, while Ukrtelecom charges only UAH 0.25 for a minute of mobile-to-fixed calls. Ukrtelecom considers the imbalance unfair and wants to charge UAH 0.50 per minute as well. Kyivstar (Ukraine’s leading mobile operator), instead, has said that it considers the old agreement valid for all of 2009: according to the company, Ukrtelecom did not inform it about the termination of the previous agreement in a timely manner. Alexander Paraschiy: It seems like the dispute between Ukrtelecom and mobile operators will become a matter for the courts. As the state is going to prepare the company to privatization in 2009, the government has additional incentive to lobby for an increase in Ukrtelecom’s interconnection rate. In case of success, Ukrtelecom would receive (by our estimates) an additional UAH 350-400 mln p.a. from mobile operators (5%-6% of the company’s revenue). Alternatively, mobile operators could agree to halve their interconnect charges to Ukrtelecom, which would save about UAH 300-350 mln p.a. for Ukrtelecom.