AT&T ends telephone service to Guyana in accounting rate spat
-callers from US urged to use MCI, Sprint

By Gitanjali Singh
Stabroek News
January 6, 2000

Many subscribers to the US telecommunications giant, AT&T were unable to contact Guyana by phone for the past few days because that company has terminated its long distance pact with GT&T in a row over accounting rates.

The Guyana Telephone and Telegraph Company Ltd (GT&T) is advising overseas customers to switch to other carriers such as MCI or Sprint or to dial 10-10-222 plus the usual numbers to connect with a circuit to Guyana.

Ordinary citizens and businessmen yesterday complained that relatives and associates were not getting through to them and a statement from the Guyana Telephone & Telegraph Company Limited (GT&T) yesterday (after this newspaper enquired into the issue) said the termination was a direct result of GT&T's refusal to lower the international accounting rates between the US and Guyana.

The press release said that AT&T had given notice of its intention to terminate the operating agreement it had between the companies a year ago and GT&T and its parent company, ATN began planning six months ago, for the possibility of the threat being carried through.

"I am extremely pleased that MCI, Sprint, and a host of smaller US long distant telephone companies are continuing to send calls to Guyana at the regular accounting rate, on behalf of their US customers, despite the actions of the FCC & AT&T," said GT&T and ATN's chairman, Cornelius Prior in the statement yesterday.

He said the only thing GT&T had not anticipated in the arrangement was that AT&T would "simply block their customers with `busy circuit' deceptive language" instead of passing the calls to MCI or other carriers to send to Guyana as most of the other US carriers do.

GT&T yesterday placed notices in the local newspapers for Guyanese friends, families or business associates in the US who are having problems "reaching you in Guyana" to connect through MCI as this will be easier. The notices, however, said nothing about the termination of the AT&T agreement and give the indication that GT&T has increased its capacity by adding MCI as one of its service providers.

Stabroek News understands that GT&T has entered into an agreement with MCI for it to connect customers to Guyana and is expected to directly notify customers in the US of the change in carriers. Sources say there is expected to be an initial slippage in revenue for the company this month given that it might take a while for customers to realise what has taken place and to switch or to access the new numbers for the circuits to Guyana. However, the net benefit to GT&T by switching to MCI is far greater as the accounting rate will be the same for the company.

The genesis of the problem between AT&T and GT&T lies in a US Federal Communications Commission (FCC) ruling that over a three- year period the accounting rate between carriers should be lowered (in the case of Guyana) from 85 US cents per minute to 23 US cents per minute. This stems from a US government position that the accounting rates are skewed against the US as it pays more in outgoing calls than it receives, almost US$5 billion annually.

AT&T sought to impose the new rates immediately (effective January 1, 2000) rather than at the end of the period (January 2002) and has been at odds with GT&T and other companies on the issue. "AT&T's proposed decrease would have created hardship, resulting in a substantial increase in phone bills for the average Guyanese customer (since GT&T's revenue from incoming calls would have been lowered)," said the statement yesterday.

The statement also said that incoming international calls are a foreign exchange earner and said the lower rates would have reduced the inflow of currency as well as national income. GT&T said it is for this reason that the Caribbean nations are resisting pressures from AT&T and the US FCC.

GT&T said its refusal to allow lower accounting rates is in keeping with the advice given by the umbrella telephone representative, the Caribbean Association of National Telecommunication Organisations (CANTO).

It said CANTO advised its membership against rushing into accelerated downward adjustments in international settlement rates in bilateral negotiations with AT&T or any other American company. The firm said that a proposal to amend the decision of the FCC to reduce settlement rates will be determined by either a special committee of the International Telecommunications Union (ITU) or by the World Telecommunications Standardisation Conference later this year.

GT&T said that in view of the connection with MCI, the AT&T action will have "absolutely no effect" on the ability of Guyanese telephone subscribers to call the United States. The statement did not speak of difficulties with incoming calls but urged Guyanese to encourage their friends and business associates in the US to "solve the problem" by switching from AT&T to MCI, Sprint or others.

Alternatively, GT&T said that AT&T can be retained and customers need to dial 10-10-222 and then 011-592-xxxxxx to connect to Guyana. This, the statement said, will allow the caller to access MCI directly and the charge for the call will be billed to MCI and appear as part of the customers' usual monthly bill.

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Guyana: Land of Six Peoples