Text Messaging Featured Article

Text messaging services are widely used as a means of communication for millions of people in their day-to­day lives. This technology offers an easily accessible and cost effective solution for all users to chat, enquire and get feedback or acknowledgment, or even communicate with businesses. SMS is a highly efficient mode of two-way communication, in addition to being an effective tool for enterprise users’ work activities.

With the cellular phone being a main digital device of choice, as they are convenient, relatively inexpensive and easy to acquire, short text messages are a valuable and widely used way for users to effectively communicate with others. As a result, SMS has changed the way people communicate. For one company in the Philippines, for instance, text messaging accounts for over 80 percent of its mobile data revenues. This, according to Napoleon L. Nazareno, president and CEO at Smart Communications, Inc., a wireless provider in the Philippines.

However, what was a free service in 1994 led to a huge uproar among subscribers when cellular service providers in the region began charging for SMS use. They were able to levy a charge on SMS but consumer activism ensured that the prices would be reasonable. Well, it seems that it did not always happen; consequently, in May of this year, the National Telecommunications Commission (NTC) ordered a sweeping refund covering several years of text message charges from telecom providers to their mobile phone subscribers.

NTC estimates there are millions of text messages, not under a “bucket pricing plan,” and therefore orders telcos to refund text overcharge. Given the huge amount of refunds … the Ayala-led Globe Telecom (News - Alert) and Philippine Long Distance Telephone Co. (PLDT) units, and other telcos opted to challenge the NTC refund order, referring the matter to the Court of Appeals (CA (News - Alert)).

NTC Director for Regulations Edgardo Cabarios explains that the reason for the order is the result of the telcos overcharging their customers on off-net text messages. Rep. Bernadette Herrera-Dy explained, “The telcos must follow the NTC directives to provide refunds to its overcharged subscribers and lower its off-net text messaging rates to the prescribed levels." The estimates made by the Philippine Daily Inquirer showed that Smart Communications, affiliate Sun Cellular and Globe Telecom may have to return at least P1.42 billion [almost $32 billion] to their subscribers.”

Cabarios chimed in, adding, “As far as the commission is concerned, we are confident that we can win this in the CA. After all, the telcos earned hundreds of millions in interest.”

This week, a post featured on online news portal InterAksyon revealed that CA has barred telecom regulators from requiring Smart Communications Inc. to refund subscribers for the alleged excess charges on text messages. A 60-day temporary restraining order (TRO) stopping the National Telecommunications Commission (NTC) from implementing Memorandum Circular 02-10-2011 was pursued.

The Memorandum Circular No. 02-10-2011: Interconnection Charge for Short Messaging Service sought to make SMS affordable to the public through appropriate modalities of interconnection with fair level of charges; this is a key objective of Sec. 5c of Republic Act 7925 (RA7925).

Under the circular, NTC directed the telcos to reduce the maximum price of text messages, but each of the three mobile phone companies, Digitel Mobile Philippines Inc., Smart Communications Inc. and Globe Telecom Inc., filed separate but similar petitions against the NTC claiming it has no power to make such demands and appealing against a government-mandated reduction in rates. Companies believe in SMS as a deregulated service with telcos having the right to set the retail price of the service.

Even so, Herrera-Dy urges NTC to conduct an inquiry on the issue to protect the subscribers, in order to prevent telcos to overcharge subscribers in the future to increase their already super-profits.

Nevertheless, the question remains will the millions of telco subscribers expect a refund anytime soon? Unfortunately for them, they may have to wait some time longer before any money is returned, as the telcos will continue to fight the issue in court.

Meanwhile, with telcos continuing to disregard the NTC order that aims to ensure that essential mobile phone services become affordable for every Filipino, it is uncertain if SMS messaging use will be affected or if the ethnic groups’ digital communications needs will be filled by other, more economical digital services.