Subtel drops MTRs by 73%

17 Jan 2014

Chilean regulator Sub-Secretaria de Telecomunicaciones (Subtel) has announced a 73% reduction in mobile termination rates (MTRs) as part of efforts to level the playing field in the wireless market. Under the new plan, which outlines a glidepath for MTRs for the next five years, the average MTR will fall from CLP64 (USD0.12) per minute to CLP17.2 per minute from 25 January 2014 before gradually dropping to CLP9.6 by 2019. During the assessment process, through which Subtel determined the new rates, the regulator noted that at the end of November 2013, Chilean MTRs were the highest amongst Organisation for Economic Cooperation and Development (OECD) countries and around four times the average level of CLP14.9. The changes reduce substantially a major barrier to entry for newcomers, whereby incoming providers were required to pay out large sums for termination to established networks without being able to recoup the losses through their own termination fees, a situation that the watchdog claims has only been worsened by the makret’s rapid growth over the last five years. Subtel has implemented an asymmetric MTR structure with Entel, Movistar and Claro paying more than double the rate charged to Nextel and VTR.