Telecoms shift battlegrounds
Mar 14, 2011
“STOP the flow of traffic and stop the debt growing. We need to change the agreement,†with that Themba Khumalo, the MTN chief, drew the battle lines, setting the stage for a telecom fight over unsettled debts with uganda telecom (utl).
By David Mugabe
“STOP the flow of traffic and stop the debt growing. We need to change the agreement,†with that Themba Khumalo, the MTN chief, drew the battle lines, setting the stage for a telecom fight over unsettled debts with uganda telecom (utl).
MTN and utl are locked up in a bitter feud over interconnect fees.
Last week, MTN threatened to terminate its inter-connection agreement with utl effective today over a sh20b debt.
However, utl claimed it paid up all undisputed interconnect fees.
It pointed out that any unpaid dues were due to the pending reconciliations and the disposal of a court case.
The decisive April 28 court case is expected to resolve what MTN says is a small component of the sh20b, but what utl insists is the only money it owes.
Whatever the outcome of the court case, the decision will deepen the telecom rivalry.
MTN disclosed that the interconnect agreement stipulates that after an agreed period of time, telecoms invoice each other as a means of offsetting any outstanding bills one firm may owe the other.
“The nature of the game is because of the traffic exchange, whoever calls more, pays the difference to the other,†Themba Khumalo, explained.
MTN says between December 2009 to June 2010, utl was served with a sh2.2b invoice, but it was Kaheru says the sh20b bill is inaccuarte Khumalo accuses utl of being diversionary not paid.
From July 2010 to January 2011, utl was invoiced with another sh5.4b bill, which it did not also pay up.
Another sh10.6b is being contested before court.
It involves routing calls to Southern Sudan, bringing the total claim by MTN to sh18.2b. But utl calls the figure inaccurate because it includes international calls to South Sudan. The agreement stipulates that if no payment is made after 60 days of invoicing, then the invoiced party has agreed to pay.
But MTN claims utl always rushes to court to buy time, frustrating their efforts to recover the money. This, MTN argued, forced it to hit hard by stopping traffic altogether. MTN was last night expected to switch off traffic with utl, a move that leaves the fate of the two operators’ subscribers unknown.
But Stanley Henning, the utl chief operating officer, said there was no need for MTN to terminate the agreement.
“The only money that may be in question is the disputed sh3.8b that is in front of a judge and the sh2.4b, which was traffic to South Sudan in 2009,†said Henning.
Mark Kaheru, the utl marketing communications manager, explained that the dispute started in 2006, after utl was granted permission to allow Southern Sudan to use Uganda’s code, +256 477.
He said it was agreed that this traffic be treated as international connection.
He said since utl is the only carrier of traffic to South Sudan, all operators route their calls through the utl network.
“uganda telecom treats traffic to South Sudan as international traffic, while MTN claims it to be local traffic. This is the gist of the dispute,†said Kaheru.
“MTN has since turned round and claimed interconnect fees basing on local traffic rates. “The matter was referred to court and the disputed amount is sh3.8b, not sh20b,†said Kaheru.
He disclosed that international connection rates attract a lower charge than the sh131, paid for local calls.
But Khumalo said this was diversionary.
“Hiding behind the disputable amount does not solve the problem. The South Sudan is about 5% of what they are supposed to pay,†said Khumalo.
However, it is not only MTN claiming unpaid dues from utl.
Joseph Kanyamunyu, the Airtel publicist, disclosed that utl owes them over sh8b in interconnect fees. “The matter is in court. Airtel has been compelled to issue a notice of termination to utl.
“We will notify our customers in due course,†said Kanyamunyu.
Kaheru could not verify this, but admitted “we have an ongoing court case with them (Airtel).†On the host of other small short messaging media houses claiming unsettled fees with utl, Kaheru said there could have been delays in reconciliation processes, which he noted usually take long.
The Uganda Communications Commission, the regulator, has reportedly tried to initiate talks to resolve the feud, but one of the parties is said to be unwilling.
“STOP the flow of traffic and stop the debt growing. We need to change the agreement,†with that Themba Khumalo, the MTN chief, drew the battle lines, setting the stage for a telecom fight over unsettled debts with uganda telecom (utl).
MTN and utl are locked up in a bitter feud over interconnect fees.
Last week, MTN threatened to terminate its inter-connection agreement with utl effective today over a sh20b debt.
However, utl claimed it paid up all undisputed interconnect fees.
It pointed out that any unpaid dues were due to the pending reconciliations and the disposal of a court case.
The decisive April 28 court case is expected to resolve what MTN says is a small component of the sh20b, but what utl insists is the only money it owes.
Whatever the outcome of the court case, the decision will deepen the telecom rivalry.
MTN disclosed that the interconnect agreement stipulates that after an agreed period of time, telecoms invoice each other as a means of offsetting any outstanding bills one firm may owe the other.
“The nature of the game is because of the traffic exchange, whoever calls more, pays the difference to the other,†Themba Khumalo, explained.
MTN says between December 2009 to June 2010, utl was served with a sh2.2b invoice, but it was Kaheru says the sh20b bill is inaccuarte Khumalo accuses utl of being diversionary not paid.
From July 2010 to January 2011, utl was invoiced with another sh5.4b bill, which it did not also pay up.
Another sh10.6b is being contested before court.
It involves routing calls to Southern Sudan, bringing the total claim by MTN to sh18.2b. But utl calls the figure inaccurate because it includes international calls to South Sudan. The agreement stipulates that if no payment is made after 60 days of invoicing, then the invoiced party has agreed to pay.
But MTN claims utl always rushes to court to buy time, frustrating their efforts to recover the money. This, MTN argued, forced it to hit hard by stopping traffic altogether. MTN was last night expected to switch off traffic with utl, a move that leaves the fate of the two operators’ subscribers unknown.
But Stanley Henning, the utl chief operating officer, said there was no need for MTN to terminate the agreement.
“The only money that may be in question is the disputed sh3.8b that is in front of a judge and the sh2.4b, which was traffic to South Sudan in 2009,†said Henning.
Mark Kaheru, the utl marketing communications manager, explained that the dispute started in 2006, after utl was granted permission to allow Southern Sudan to use Uganda’s code, +256 477.
He said it was agreed that this traffic be treated as international connection.
He said since utl is the only carrier of traffic to South Sudan, all operators route their calls through the utl network.
“uganda telecom treats traffic to South Sudan as international traffic, while MTN claims it to be local traffic. This is the gist of the dispute,†said Kaheru.
“MTN has since turned round and claimed interconnect fees basing on local traffic rates. “The matter was referred to court and the disputed amount is sh3.8b, not sh20b,†said Kaheru.
He disclosed that international connection rates attract a lower charge than the sh131, paid for local calls.
But Khumalo said this was diversionary.
“Hiding behind the disputable amount does not solve the problem. The South Sudan is about 5% of what they are supposed to pay,†said Khumalo.
However, it is not only MTN claiming unpaid dues from utl.
Joseph Kanyamunyu, the Airtel publicist, disclosed that utl owes them over sh8b in interconnect fees. “The matter is in court. Airtel has been compelled to issue a notice of termination to utl.
“We will notify our customers in due course,†said Kanyamunyu.
Kaheru could not verify this, but admitted “we have an ongoing court case with them (Airtel).†On the host of other small short messaging media houses claiming unsettled fees with utl, Kaheru said there could have been delays in reconciliation processes, which he noted usually take long.
The Uganda Communications Commission, the regulator, has reportedly tried to initiate talks to resolve the feud, but one of the parties is said to be unwilling.