A new report from US-based analyst firm IDC has cited a recent circular of the country’s regulatory body that mandates the shift to pulse billing for mobile usage, saying this will tilt the “balance of power within the mobile services market” in favor of consumers.

Under Memorandum Circular 05-07-2009 issued by the National Telecommunications Commission (NTC), calls for mobile operators to bill their subscribers from the current per minute charging to per pulse (six seconds) charging, with the first two pulses being charged with a flag down rate.

The new ruling also calls for amendment of the interconnection agreements among service providers and related parties to comply with the new billing scheme. Further, it allows mobile subscribers to still opt for per one minute per pulse rate billing or to subscribe to unlimited service offerings.

The research outfit noted that while mobile service providers have accepted the new NTC order without major resistance, they have requested that the implementation be deferred from December 2009 to January 2010.

“The main reason provided is that shifting to per pulse charging entails enormous network and technical testings and modifications. To avoid service disruptions and drop in service quality, mobile operators avoid implementing any major adjustments during December, which is historically a peak period in terms of mobile services uptake,” the report observed.

IDC said it expects the new mobile voice charging system to boost voice call usage, mainly because it allows users more options. “By being charged on a per six second basis as opposed to per one minute, mobile consumers will be allowed to avail of and pay for only the amount of service that they need,” it said.

The research firm said the Philippine mobile market has always been a highly retail market, wherein mobile users’ spending pattern and preference lean towards making small immediate spending.

“This is reflected in the fact that prepaid users consist more than 95 percent of overall mobile subscriber base,” IDC said.
Nevertheless, the new charging scheme is not expected to shift user preference from texting to making calls, the report added. “Filipinos’ penchant for texting is not only based on the fact that it is cheaper than making voice calls, but also on cultural factors.”

IDC said although many consumers skirt around the prevailing per minute charging by availing of unlimited and bucket-priced voice call services, most of these are offered on promotional basis.

“These offers allow subscribers to spend for voice calls more prudently but are inconvenient to depend on. Such offers are rather sporadic and varying, and usually require additional instructions such as dialing certain prefixes or limiting calls to certain periods within the day or night,” it noted.

Although glitches during an adjustment period may be expected, IDC said it sees the recent development as an accelerator for the mobile services market in general as it is one step closer to user-centricity and is expected to encourage service uptake.