Telecommunications industry rejects fixed network flat rate in basic service
Starting in 2018, customers with a landline subscription will be able to make calls to Swiss landline and mobile networks as often as they like—without paying any extra. According to the federal government, the maximum cost for this should be 29.35 francs. Now the telecommunications industry is pushing back, arguing that free competition is at risk.
Specifically, the industry is concerned that the price of a landline subscription in the basic service should include all calls made from 2018 onwards - regardless of how often and for how long someone makes calls. The maximum subscription price should be CHF 29.35 per month. This is provided for in the revision of the Ordinance on Telecommunications Services, the consultation on which ended on Tuesday. It is necessary because the current universal service license is expiring. Swisscom still has the license until the end of 2017. However, it is likely that it will retain the license and could be forced to offer the flat rate from 2018.
Distortions of competition
However, anchoring the flat rate in the basic service would lead to distortions of competition, criticized the Association of Telecommunications (asut) in a statement. A fixed network connection without a flat rate already costs around CHF 25 per month with Swisscom and Sunrise. In future, users will be able to make unlimited calls to all Swiss networks for around four francs per month. According to asut, the new price cap cannot be justified. The universal service guarantees a basic offering at affordable prices across the country. However, it should not be interpreted as an "entitlement to everything you want". Telecom provider Salt also warns against "regulation for the sake of regulation".
No standard market price
For the cost calculation, OFCOM used the current price charged by Swisscom for the "last mile". This is currently CHF 13.30. For the flat rate, the Federal Office added the additional monthly amount of the current Vivo offers from Swisscom. This calculation is met with incomprehension in the industry. Swisscom is not aware of any market offer that could compete with the proposed price caps, the company writes. Instead of the standard market price, Bakom has used the cost-oriented price.
The future is flat rate
The Confederation justifies the switch to a flat rate with the trend over the next few years. In all likelihood, a flat rate for calls will become the norm, according to the explanatory report. For Swisscom, it is undisputed that flat rates are becoming increasingly popular. However, a clear majority of customers still make calls on the basis of minute-based billing, the company argues. (SDA)
