Central Europe Review: politics, society and culture in Central and Eastern Europe
Vol 0, No 7
9 November 1998

Andrew Stroehlein C Z E C H   T E L E C O M M U N I C A T I O N S :
Telephone Billing ala Americana
An answer for the current Internet
revolt in the Czech Republic

Andrew Stroehlein

With phone rates set to rise, it is even more obvious that telephone billing in the Czech Republic is backward and hinders development of information technology. We should learn a cheap and simple lesson from the US.

Unless a reform of the telephone billing system does not happen soon, the Czech Republic will find itself unable to keep up with the demands of the information age. In the US the billing system is simpler, cheaper and more conducive to the needs of Internet users. It is no coincidence that the US has the largest number of regular Internet users.

A number of events have exploded on to the Czech telecommunications scene in the past few days and weeks that should draw the attention of every person in the Czech Republic who regularly uses a telephone. First, the Czech Telecommunications Commission rejected the cellular phone company RadioMobil's right to offer its customers cheaper long distance service by clever use of the Internet. This move guarantees SPT Telecom's six-year monopoly which the government granted it - in exchange for promised infrastructure improvements - back in 1994.

Second, the Ministry of Finance and the Czech Telecommunications Commission recently allowed a "deregulation" of prices that could see local telephone rates shoot up by 60%. Plans to increase local rates are now in the works.

Ondrej Neff, editor of the Czech Internet daily Neviditelny pes, was correct to call it the "arrogance of a monopoly" (Lidove noviny, 9.11.98 in Czech only). He is also right to say that if the planned rate increases go ahead, we can just about say goodbye to the Czech Internet.

A protest movement has sprung up, and a petition has been started (English version HERE). Tens of thousands of signatures have been gathered in the space of a few days. Unfortunately, with Czech politicians normally unresponsive to the public and with most politicians hopelessly ignorant and negative about the new information technology (see Vaclav Klaus's comments last year), one worries that the petition will not make an impact.

The Internet is not the be all and end all of the world, but a company interested in attracting foreign business can hardly hope to compete in today's world without it. The wealth of information it provides - relatively cheaply and quickly - increases knowledge and productivity of workers and students wherever it is in place. The Czech Republic is not going to help itself out of it present economic recession by ignoring it.

What can the Czech Republic do to boost itself into the information age? I would like to suggest a simple reform of local telephone billing along the lines of the American method. Simply put: all the local calls of a single customer in one month are charged one reasonable price. One price, phone locally as much as you like. In the US such a simple system, costing about five dollars (150 Kc) per month to each customer, is proven to reduce administration costs for the telecom providers and billing charges for the consumer.

Don't tell me the US can afford to have this system only because it is rich. Many "rich" countries, such as the UK, continue to use the outdated, Internet-killing line-item charges for local calls. It has nothing to do with rich and poor countries: it has to do with good government regulation and some effort to reduce the "arrogance of monopolies."

What would that once-a-month charge be? I cannot give a concrete figure, of course, but if the telecoms in the US, with higher labor costs to deal with, can charge about 5 USD a month, I don't see why SPT Telecom would have to charge more than that.

It is a simple solution that would save everyone time, aggravation and money.

Andrew Stroehlein, 9 November 1998


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