RedVoiss hails "milestone" Telefonica ruling as recognition of VoIP

Tuesday, January 18, 2011

A supreme court ruling this week that favored Chilean IP telephony enabler RedVoiss in a dispute with Telefonica Chile over unfair pricing is a milestone as it recognizes that the future of voice telephony is with the internet, RedVoiss CEO Alberto Mordojovich told BNamericas.

"The most important thing to take from this ruling is that it takes the phone out of telephony and places it in broadband, which is what should have happened a long time ago," he said.

The supreme court confirmed a probe by Chilean antitrust tribunal TDLC in March last year finding that Telefonica (Movistar) was obliging clients to contract bundled services, as the price for these packaged services was significantly lower than if they were contracted individually.

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Telefonica appealed the TDLC's finding, but the supreme court ruling cannot be appealed, meaning Telefonica must pay the 2.3bn-peso (US$4.5mn) fine recommended by the TDLC and start offering naked broadband, or a standalone broadband at a reasonable price, Mordojovich said.

"The supreme court ruling is on a level similar to a law, meaning that it is an obligation to offer naked broadband," Mordojovich said.

"At the same time, this ruling has an interesting component in that the price of broadband must reflect the costs of providing the service, and that could mean [telecoms watchdog] Subtel may have to intervene in the costs study to be able to fix prices, at least in the case of Telefonica," he added.

He said that theoretically the ruling should apply to all service providers, but added that others in the market - such as cable player VTR, which has been offering triple-play packages for years - has a naked broadband offering.


A spokesperson for Telefonica Chile told BNamericas that the company has had a naked broadband service available for customers who call and ask for it since the TDLC's ruling in March 2010, with prices starting at 18,490 pesos (US$37).

The company also said that it accepted the court's decision.

"We have always believed in free competition. We never infringed on the law. So while we maintain that we acted in the interests of providing our customers with the best service alternatives, we accept the court's decision and will conform to the ruling, and continue to work to provide the best offer for our customers," the spokesperson said.

In July 2007, RedVoiss won a 228mn-peso suit against Telefonica for blocking RedVoiss' broadband clients from accessing its Voissnet service. RedVoiss immediately filed a second lawsuit accusing the operator of unfair pricing of its packaged services, which is what was resolved this week.