BASE issues interconnection ultimatum to regulator

30 Mar 2006

Belgian mobile operator BASE has said that it will only comply with a demand from regulator the BIPT to cut its interconnection rates if market leader Belgacom Mobile follows suit. Earlier this month the BIPT proposed to regulate mobile interconnection rates, in a move that would see the three operators cut their tariffs by almost half over the next two years. The proposals would see BASE cut its interconnection tariff from EUR0.196 to EUR0.1041, whilst Belgacom Mobile would lower its prices from EUR0.1266 to EUR0.0656 and Mobistar EUR0.1598 to EUR0.0821. BASE, the market’s smallest operator, says it is concerned that if it complies with the cut at the proposed levels, it will fall further behind rivals Belgacom Mobile and Mobistar, leading to the development of a de facto market duopoly for the larger operators. It claims that the proposed regulations allow the incumbent operator to continue to demand interconnection rates that are much higher than the marginal cost of its network, which it says have now been ‘written off in full twice by the exorbitant profits made by the historical operator on interconnection alone’.

Belgium, BASE Company