Digicel said it is losing at least $23 million a month routing its international traffic through the Guyana Telephone &Telegraph Company (GT&T), but places it wider revenue loss in the region of $3 billion a year, while the monopoly on international traffic persists.

The company, which filed a suit against GT&T on Friday, said that its customers would save $25 million a month in international call charges if GT&T’s rates were more competitive. It charged that the rates levied by GT&T for international calls are above average cost elsewhere.

Digicel currently provides international service through interconnection with GT&T, but the company said in court documents that its system is capable of providing international voice and data transmission as a service independent of interconnection with GT&T.

“Despite having the technical, intra-company and international capacity and capability to hold opinions, to receive ideas and information, and to communicate ideas and information, the applicant is unlawfully interfered with, hindered and prohibited from fully using its own international voice and data transmission services in the enjoyment of the freedom of expression guaranteed by the constitution of the Co-operative Republic of Guyana,” the court documents said.

In a move to the High Court through its attorneys, Ralph Ramkarran SC, Edward Luckoo SC and Stephen Fraser, Digicel is seeking a declaration that it is entitled to the grant of the amendment to its licence of February 21, 2001, issued under the Telecommunications Act 1990, and as prayed for in its letter of application dated June 8, 2007, addressed to the Director of Telecommunications. This amendment, it said, would permit the provision of international service other than through interconnection with other licensed telecommunications operations, GT&T being the only other licensed operator at all material times.

Digicel is also seeking an order directing the Minister and/or the Director of Telecommunications and/or any other relevant agency of Government to amend its licence, pursuant to its application of June 8, 2007.

Digicel said that it applied to the Director of Telecommunications in 2007 for an amendment to the existing licence seeking (inter alia) to remove the “unlawful and unconstitutional restriction whereby it is prohibited from offering international service save through GT&T”, but never received a response and a subsequent letter seeking an update on the status of its application, was also not acknowledged.

The company said the maintenance of the international facilities monopoly and exclusive licence grant to GT&T has affected it more than and differently from, the public at large and that it has prejudiced the company in its personal and proprietary interests.

Digicel listed a string of interests, saying that the monopoly has adversely affected its ability to compete in the provision of mobile services because it is being denied access to revenues from handling international inbound traffic while having to make substantial payments to GT&T for handling outbound international calls, while for GT&T, such charges are purely notional internal transfers.

It said among other things, that it is at a disadvantage in that the cost to GT&T of handling outbound international traffic is internalised whereas it pays the full cost of such traffic to GT&T less minor discounts to some markets.

Digicel said too, that the most immediate commercial effect of the restriction is to prevent it from earning the full commercial rate for incoming calls sent by international carriers to Guyana and destined for its network. The restriction forces Digicel to hand all of those calls over to GT&T for onward transmission at rates determined by GT&T, thereby depriving Digicel of the opportunity to secure competitive terms on the international market for outgoing international calls.

“The effect is a loss of revenue and an inflation of the applicant’s cost. The immediate effect is that the cost of both incoming and outgoing international calls is above competitive levels thereby artificially depressing demand for those services and in turn restricting free speech and expression.”

According to Digicel, it receives a termination payment of $7 per minute for each incoming international call destined for one of its customers, which must in every case be brought into Guyana through GT&T network, before being handed to Digicel. The company said that if it were to receive those calls directly, then using the bottom end of the estimate for GT&T’s terminating rate of $46 per minute (received from it by foreign carriers), this entails a loss in revenue per minuet of $39.

Digicel said that in the first quarter of 2009 it received incoming international traffic of 6,510,790 minutes, foregoing $254 million in revenue. On an annualized basis, the company said it loses in the region of $3 billion. It pointed out that these figures (which are derived from interconnection invoicing between the parties) do not take into consideration the significant impact of calls being illegally routed by unauthorized operators through bypass, “as a direct consequence of the high termination rates charged by GT&T”.

In respect of outgoing international service, Digicel said that it sent 1,189, 415, minutes in the first quarter of 2009 charged at an average cost of $88 per minute. Digicel said it is sending GT&T that volume of international minutes at a price over which it has no control. It said also, that GT&T does not offer any wholesale (in the sense of cost-based) international rates for international call termination and that it is obliged to pay for the prevailing retail rate for the delivery of the traffic, subject to some insignificant discounts.

“As a result, despite the global reduction in international call termination rates, there has been no reduction in international call charges in Guyana since the applicant’s mobile licence was granted in 2004,” Digicel continued.

Digicel said that the five most popular destinations for international traffic for its customers are USA, Trinidad and Tobago, Barbados, Antigua and Canada, adding that these destinations account for over 80 per cent of its international traffic. It stated that the highest quoted termination rate to any of the locations in March 2009 is $39 to terminate a call to Barbados’ fixed network. According to Digicel, it is losing at minimum $51 per minute routed through GT&T’s network. Therefore, the company said it is losing at least $23 million routing traffic through GT&T on a monthly basis.

The company said also that if retail rates were closer to the average mean (50 per cent reduction in rates) its customers would save $25 million per month in international call charges. It charged that the charges levied by GT&T for international calls to the USA in 2007, when compared with that from other jurisdictions in which it operates, was approximately 50 per cent above the average costs elsewhere.

Further, the company said that it would be able to significantly reduce the cost of international calls made by its customers from Guyana if it were free to use its own facilities and to enter into direct arrangements with foreign carriers. It added that the transformation from monopoly to competition has resulted in a far more favourable outcome for customers