TSTT Clarifies Single National Rate Plan Announcement

TSTT wishes to provide additional information regarding our announcement of plans to implement a single national rate. The principal issues centre around TSTT’s notification requirements relative to the Regulator, TATT, and its customers; whether the Regulator has the authority to approve/disapprove the proposed rate revision; as well as the actual impact of the Single National Rate on customers.

TSTT’s position on the issues regarding TATT is that we have notified TATT in the manner prescribed in our Concession Agreement. In fact, TSTT has used this same procedure on two other rate changes during the past year. TATT raised no objections to the procedure in either instance. Customer notification of this Single National Rate was also carried out in accordance with the Concession Agreement. Given this compliance, along with the precedent set for previous rate adjustment action, TSTT believes that it has fully observed all relevant regulations in announcing the Single National Rate. Moving forward, TSTT will continue to work with TATT to ensure that any misunderstandings regarding procedural requirements for notifications are resolved.

Further, according to the Telecommunications Act of 2001, service providers are required to seek approval for proposed rate changes only if the Regulator has implemented a Price Regulation Regime. We understand that work on this regime is in process at TATT; however, no price regulations exist at this time. TSTT is of the view, therefore, that there is no requirement to await regulatory approval of the Single National Rate.

Most importantly, however, we must remember that the Single National Rate plan is in response to our customers’ desire for simpler calling plans. Advancements in telecommunications technology have tended to negate distance as a factor in determining calling rates. The single national rate is a reflection of this trend. Introducing the Single National Rate seeks to align customers’ preferences with the calling rate structures experienced in international and mobile calling. The plan has already been hailed as offering huge cost savings for many of our customers.

Nevertheless, TSTT is mindful that some of our customers may need some time to adjust to the new rate plan, particularly as it relates to calls within an exchange area. Such calls today have an effective rate of 23 cents per call. As such, from September 2007 to February 2008, charges for such calls will be ‘capped’ or limited for this period of time. For the first 3 months, charges for calls within the same exchange area will be limited to 69 cents per call, regardless of length. For the following three months they will be limited to $1.15 per call, regardless of length. TSTT will monitor the price-ceiling mechanism throughout this period as the company works to ensure the best possible service solutions are provided to customers.